Robbie Traube: I think [indiscernible] customers, they continue to spend with us. The numbers that we pulled out, I mean, that $250,000 plus cohort, that grew 17% year-on-year, $500,000 group, 24% year-on-year. So we continue to see that because it is mission-critical to what they do.
Tien Tzuo: And that really just speaks to the general agility that we have and how we attack the marketplace.
Joshua Reilly: Got it. That’s helpful. And then if you look at the change in the operating income guidance, you guys seem to continue to find areas of savings there. What would you say is the biggest piece of savings maybe versus your initial plan for the year? And where do you continue to see a source of operating leverage maybe for the rest of this fiscal year in your operating expenses? Thanks guys.
Todd McElhatton: So, Josh, we’re continuing to be super disciplined on everything that we’re spending. One of the things that we said this year was we want to have the ability to either if the market makes sense to go ahead and invest in top line growth, feel good about where we are on top line, we’re going to be where we said we’d be at the beginning of the year. We’ve not seen a reacceleration in the market. So we’re not adding additional capacity in — so that’s certainly an area that’s helping us. We’ve spent a lot of time in the go-to-market areas on how do we get more efficient there. That will continue to drive efficiencies. You saw the COGS, especially on the subscription side, jumped up to 81%. So I feel very good about what’s happening there, taking a look at how we put engineering resources and doing that another area where we’re looking at.
The same thing with G&A. So it’s really across the board where you go. Obviously, the first area that in our biggest area of spend is to go to market, and we are constantly working to get that more efficient. And then like I said, we’ll continue to evaluate and as it makes sense, we’ll continue to get leverage out. But as we continue to grow and more and more of our bookings, as we become a larger company, those dollars, a lot of them go to the upsell bookings, just the CAC on that is a lot better than when we’re investing in new logos. And so as we continue to get larger, that will also give us more leverage in the operating model.
Tien Tzuo: I mean, Josh, just to add one more thing, this is Tien, take this as an opportunity to show off some [indiscernible] stuff. Obviously, at the end of the day, it’s about efficiencies, it’s productivity. It’s about being able to do more with the same number of resources. If you look at Todd’s organization, partnering with the IT organization under Daisy, we are using our own products to become more efficient. And we’ve taken a number of days on our side, down from 13 days to five days close and that’s the type of thing that we think we can use our technology for that our customers really can have benefit as well.
Joshua Reilly: Got it. Super helpful. Thanks guys.
Operator: Your next question comes from the line of Chad Bennett of Craig-Hallum. Your line is open.
Chad Bennett: Great. Thanks for taking my question. So just on kind of the progress you’re making on the smaller and faster lands. Just in terms of magnitude, is there any way to think about kind of where those — if there’s any historical data of kind of where a land would be today relative to what you’ve seen in the past and just kind of the magnitude of the ACV difference there?
Todd McElhatton: Chad, I think at a couple of ways. One is, if you take a look, we have landed a bit lower on the ASP over the last couple of quarters from the standpoint of having more deals and those deals are bringing more new logos on and bringing them a bit lower. They’re not like half the size of what we were doing before, but there’s still nice six-figure deals. The other thing that I would say about when we’re looking at those, if I look at our top five customers, I want to say four of those five started off right around [100, 150] (ph). And those are now customers running over $5 million a year in ARR. So we certainly have shown we picked the best and the fastest growing companies. And I say the fastest growing, that may mean they’re subscription businesses.
We have a huge opportunity to expand. And so that’s kind of the filter that we’re putting on when we’re going after smaller lands is, again, making sure there are companies that we can grow with over the long term.
Tien Tzuo: That’s right. I mean each of these companies we’re signing on, we still believe that the lifetime value of that customer that we’re pursuing has not changed. Right? But if we can start smaller with them and have confidence that we can grow them up to that point, then given the macro situation, given the scrutiny on technology spend, why not get started with them now.
Chad Bennett: Okay. I appreciate the color. And then maybe just on the dollar-based net retention at 107%. I know you reiterated, I think, the 107% to 109% range. Just in terms of the level of confidence and visibility that 107% is kind of the trough here. As you look at the pipeline, Tien or Robbie or Todd for that matter, just what gives you confidence that, that 107% holds to potentially improve over the next couple of quarters here, if you think that.
Todd McElhatton: Sure, Chad. I’ll maybe take that. So two things that impact the DBRR, the first is our retention rates, and I feel really good about the fact that three of the last five quarters, we’ve talked about another record from a standpoint of higher retention rates. We had the highest historical retention rates this quarter of all time. So feel really good about our ability to pick the right customers and keeping them. And a lot of that has been a strategy that we embarked upon three years ago and going after the enterprise. The second thing that drives that is certainly the expand base. And one of the things that we’ve talked about is there’s a volume element of that for us. And we have certainly seen that as our customers aren’t growing as fast, that what we’ve seen is there’s been a bit of a slowdown from what they’re purchasing on us in additional volume.
