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SentinelOne Reports Strong Q3 Performance Driven by New Customer Growth and Product Innovations

SentinelOne has reported impressive financial results for the third quarter, surpassing historical trends. The company experienced a 4% year-over-year growth in net new Annual Recurring Revenue (ARR), indicating a positive shift in its business momentum and market position.

Broad-Based Strength Amidst Economic Challenges

Despite a difficult macroeconomic environment, SentinelOne’s Q3 performance was robust across all regions and product offerings. The company achieved a growth margin of 80%, with operating margin improving by more than 6 percentage points compared to the previous year. Notably, this marks the second consecutive quarter of positive net income.

Expanding Customer Base and Increasing Demand

With a solid balance sheet and improving margins, SentinelOne is well-positioned for long-term growth. During this quarter, the company welcomed a record number of customers with ARR exceeding $100,000, reflecting a 24% increase year over year. The growth for customers generating over $1 million in ARR was even more pronounced, further enhancing overall ARR per customer.

Investor Engagement and Product Evolution

In October, SentinelOne hosted its inaugural investor day at the OneCon customer conference, which attracted record attendance and enthusiasm. A key focus of the event was the development of the Singularity platform, which has evolved into one of the industry’s most reliable security solutions for enterprises. With cutting-edge AI security models and extensive coverage capabilities, Singularity continues to be recognized as a leader in the field.

Major Partnerships and Expanding Capabilities

The company has secured significant platform deals, showing its capacity to provide comprehensive security solutions without overwhelming customers with a plethora of modules. For instance, a major international retailer significantly increased its ARR through a multimillion-dollar deal that included endpoint, cloud, and identity security, alongside Purple AI and threat hunting services.

Innovative AI Solutions Driving Growth

Purple AI, a standout feature of the Singularity platform, has seen rapid adoption. In the third quarter, the engagement rate of Purple AI across eligible endpoints doubled compared to the previous quarter. This innovative solution streamlines security workflows and enhances productivity for analysts, bolstered by recent enhancements like auto alert triage and threat investigation capabilities.

Next-Generation Cybersecurity with AI SIEM

SentinelOne’s AI SIEM is a revolutionary approach to cybersecurity, offering comprehensive visibility and real-time detection across the security landscape. Major clients, including federal agencies, have opted for unified threat visibility through this platform. The company is also working with Managed Security Service Providers (MSSPs) to improve their service offerings using Purple AI and the Singularity Data Lake.

Cloud Security Innovations and AI Safeguards

The firm continues to lead in cloud security through its advanced cloud workload protection solutions. New offerings like AI Security Posture Management (AI-SPM) are designed to help enterprises secure their AI services against potential vulnerabilities. With AI-SPM, organizations can monitor configurations and identify risks in AI applications effectively.

Core Reliability in Endpoint Security

Endpoint security remains a foundational element of SentinelOne’s offerings, crucial for driving business results. As the cybersecurity landscape evolves, the company is committed to remaining at the forefront, delivering innovative security solutions that resonate with clients in diverse industries.

SentinelOne Sees Remarkable Growth Amid Rising Cybersecurity Demand

July’s IT outage has prompted enterprises to prioritize security, performance, and reliability. As a result, more large organizations are evaluating our technology for the first time, and the feedback has been positive.

In Q3, we achieved a record number of customer acquisitions, surpassing our closest competitor. For instance, a Fortune 50 company opted for SentinelOne due to our superior platform architecture and integration capabilities, notably enhanced by Purple AI. Additionally, several federal and local government agencies switched to us after testing our platform against their prior solutions. They found our Singularity platform to be user-friendly and an improvement to their security measures.

Many of these new customers are looking to enhance their capabilities with Singularity Data Lake and Purple AI, features not available in alternative solutions. Critics of incumbent solutions are increasingly recognizing their limitations, including siloed systems and reliance on human oversight, which struggle to keep up with modern cybersecurity threats. One notable case involved a customer who previously relied on Microsoft Defender for endpoints but faced breaches twice in the past year. They ultimately decided to transition to SentinelOne for comprehensive endpoint protection.

With heightened awareness and interest in our offerings, we are entering opportunities that were unattainable before, including partnerships with some of the largest financial institutions globally. This development indicates a broader shift as enterprises continue to assess and replace existing solutions over time. Our path is clear for growth. To capitalize on this, we are strategically increasing our market presence.

Our collaboration with Lenovo, the largest PC manufacturer, stands out. Lenovo will bundle our Singularity Platform and Purple AI with new enterprise PC shipments, significantly enhancing security for millions of endpoints worldwide. This partnership illustrates how SentinelOne can collaborate with other industry players rather than simply competing with them. We believe that aligning with Original Equipment Manufacturers (OEMs) like Lenovo will greatly expand our reach.

Furthermore, we have strengthened our position within the federal sector, recently attaining FedRAMP High certification for both endpoint security and AI-SIEM. This rigorous vetting over several years underscores our ability to meet the most stringent security requirements. Our partnership with AWS has also grown; AWS customers can now utilize Purple AI on Amazon Bedrock.

We aim to deepen our collaboration with Amazon, allowing customers to deploy Singularity on one of the largest cloud platforms available. Additionally, we are empowering Managed Security Service Providers (MSSPs) to integrate more of the Singularity Platform’s capabilities, such as Singularity Data Lake and Purple AI, enhancing their operational efficiency and security posture. Recently, we launched a suite of agent-less Cloud Native Application Protection Platform (CNAPP) solutions tailored for MSSPs, covering Cloud Security Posture Management (CSPM) and Cloud Infrastructure Entitlement Management (CIEM), among others.

Overall, our enhanced execution, growing market presence, and cutting-edge platform capabilities are driving significant customer engagement and interest in SentinelOne. It is crucial for us to leverage these advantages to convert opportunities into wins over time. We are dedicated to forming strong relationships with both customers and partners to implement the Singularity Platform effectively, seeking to support organizations in navigating the ever-evolving threat landscape.

Cybersecurity solutions are integral to enterprises’ strategies. We continue to innovate, focusing on intelligent, autonomous cybersecurity for the future. Recently, we were honored to land a spot on Fortune’s Future 50 list, recognizing us as a company likely to adapt, thrive, and expand. We are confident in our strategy, team, and technology.

Encouraged by our Q3 growth, we acknowledge that investments in expanding our market presence are contributing to one of the fastest growth rates in the software sector. In this quarter alone, we recorded impressive results across platform solutions, secured positive new business growth, and continued margin expansion. We are positioning the company for long-term share gains across diverse growth avenues.

Next, I will turn the call over to Barbara Larson, our Chief Financial Officer.

Barbara Larson — Chief Financial Officer

Thank you, Tomer, and thanks to everyone for joining us today. I’m delighted to be here. Starting this role has been a rewarding journey, and I’m honored to work with a talented team dedicated to advancing cybersecurity.

Our goal is to secure the future through innovative technology. From a financial standpoint, we pledge to create sustainable value and build on the current strengths. I see abundant opportunities for long-term growth and efficiency. Let’s delve into our Q3 financial performance and guidance for Q4 and fiscal year ’25.

As a reminder, all comparisons are year-over-year unless stated otherwise, and the financial measures we discuss are non-GAAP. We surpassed our revenue and Annual Recurring Revenue (ARR) growth expectations for Q3. Revenue rose by 28% to $211 million, showcasing strong performance across all regions. International revenue also increased by 28%, accounting for 37% of our quarterly total.

In Q3, our total ARR grew by 29% to $860 million, with net new ARR at $54 million exceeding our forecasts and demonstrating a 22% sequential increase, significantly surpassing our historical Q3 performance. This reacceleration of new business growth marks a return to positive trends and indicates we are in a strong position to achieve higher net new ARR gains in the latter half of the year compared to the first half.

This quarter, we welcomed a record number of customers contributing $100,000 or more in ARR, indicative of our team’s solid execution and competitive edge. The growth of our emerging solutions and success with large enterprises have driven up the ARR per customer, which has increased significantly year-over-year and reached new highs in Q3. Consistent with previous quarters, we maintain healthy expansion rates within our existing customer base.

In addition to revenue growth, our Q3 gross margin of 80% reflects the strong economics of our Singularity Platform and disciplined pricing strategies. Our operating margin for the quarter was negative 5%, representing a 6 percentage point improvement from the previous year. Notably, Q3 expenses included one-time legal settlement costs affecting our non-GAAP financials.

SentinelOne Reports Promising Q3 Financial Results Amidst Growing Market Dynamics

Strong Financial Performance and Future Outlook

SentinelOne has achieved notable milestones in the recent quarter, reporting a positive net income for the second consecutive time. For the first time in company history, it also secured positive free cash flow on a trailing 12-month basis. The company is well-positioned to maintain positive cash flow for fiscal year ’25. This growth is attributed to expanding scale, enhancing operational efficiency, and effective cost management.

Significant improvements in margin and cash flow have been observed. While increasing market presence remains a priority, these investments are already showing early success. Indicators include greater adoption of new platform solutions, impressive wins against competitors, and a notable uptick in new business growth. Financial health is robust, with over $1 billion in cash, cash equivalents, and investments, coupled with zero debt.

Q4 and Fiscal Year ’25 Revenue Guidance Updated

For Q4 and fiscal year ’25, the company has revised its revenue forecast upward. Given the strong new Annual Recurring Revenue (ARR) in Q3 and ongoing business momentum, full-year revenue is now expected to reach around $818 million, reflecting a 32% growth rate. This marks an increase from previous expectations of $815 million and 31% growth. For Q4, revenues are projected at approximately $222 million, indicating a year-over-year rise of 27%.

Looking ahead, stronger growth in net new ARR is anticipated for the second half of fiscal ’25. This optimism is backed by positive trends in customer acquisition, a healthy sales pipeline, and increasing traction with data, cloud, and AI solutions. Nevertheless, it’s worth noting that the macroeconomic landscape presents challenges, compelling organizations to prioritize efficiency and cost. These dynamics are expected to continue influencing the market.

Margin Expectations Remain Strong

Despite pressures, SentinelOne anticipates a gross margin of about 79% for the full year, an increase of over 150 basis points from last year. In Q4, gross margin is expected to match this figure, reflecting a year-over-year improvement of about 100 basis points.

For fiscal year ’25, the operating margin is projected to be approximately negative 4%, which aligns with previous guidance and shows an enhancement of 15 percentage points compared to fiscal year ’24. In Q4, the operating margin is expected to be around negative 3%, indicating a six-percentage-point improvement year-over-year and a two-point increase sequentially. The foundation has been laid for SentinelOne to reach new heights, driven by robust AI security capabilities and a growing customer base.

Path to Sustainable Growth

SentinelOne is nearing the significant milestone of crossing $1 billion in ARR, a testament to its expanding market influence. As the company grows its reach and enhances its offerings, it is well-prepared to safeguard more endpoints and secure a larger number of businesses worldwide. The investment strategy strikes a balance between long-term growth and maintaining a strong financial profile, crucial for scaling to a multibillion-dollar valuation.

Operational discipline is being emphasized, with an eye toward enhancing efficiency and productivity. Ultimately, the aim is to achieve sustainable growth while pursuing a long-term target of a 20% operating margin. The commitment to customers, partners, and security is foundational to SentinelOne’s ongoing success.

Reflecting on progress, there is a sense of pride in the dedication of the team and the achievements to date. As opportunities continue to emerge, confidence in future potential remains high. The session concluded with an invitation for questions, highlighting an openness to engagement with analysts, shareholders, and the broader investing community.

Questions & Answers:

Operator

[Operator instructions] Our first question comes from Brad Zelnick with Deutsche Bank. Brad, your line is now open.

Brad Zelnick — Analyst

Thank you. It’s exciting to see the ARR momentum continue. Tomer, you mentioned in past comments that we wouldn’t see the immediate benefits of market disruptions in your financials. Given the positive trend in Q3, what insights do you have regarding the pipeline to support future acceleration? Barbara, how might this shape your perspective for next fiscal year? Thank you.

Tomer Weingarten — Chief Executive Officer

The July outage contributed to the ongoing momentum we are witnessing. We are beginning to reap the rewards, with an increase in customer opportunities and a record pipeline while maintaining a solid win rate, which will bear fruit over time.

In Q3, we saw a record number of wins against competitors and attained a record number of customers. Our growth in endpoints also accelerated, indicating improved opportunities in both emerging products and the core endpoint market.

This momentum led to unexpected gains in ARR this quarter, and we expect this trend to continue as enterprises increasingly prioritize security performance and operational resilience. SentinelOne has become a preferred platform, which fosters larger deals and more engagement, enabling progress as we access previously unattainable conversations with varied industries.

Barbara Larson — Chief Financial Officer

As for FY ’26, it’s premature to provide guidance right now. Our focus is on maximizing the opportunities in front of us. We are, however, pleased to observe a reacceleration in net new ARR growth in Q3, benefiting from stronger year-over-year results in the second half over the first half.

Brad Zelnick — Analyst

Thank you for the insights.

Operator

The next question comes from Gray Powell with BTIG. Gray, your line is now open.

Gray Powell — Analyst

Thank you. It’s encouraging to see the net new ARR back in positive territory.

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SentinelOne’s Q3 Growth: Factors Behind the Surge

As SentinelOne posted notable quarterly growth in Q3 2023, several elements contributed to this success. Company leaders discussed the drivers behind the stronger performance compared to previous years and the sustainability of these gains.

Tomer Weingarten — Chief Executive Officer

Two key factors fueled the impressive quarter-over-quarter growth this year. First, our emerging products are gaining traction, allowing us to provide more capabilities such as Purple AI. The detach rate for this product doubled compared to the previous quarter, showcasing significant progress.

Additionally, our cloud solutions continue to improve as more data becomes accessible. These new capabilities are expected to lead to larger deals, which we’ve already observed in our pipeline as we approached Q3.

Another important influence was the outage on July 19, which prompted many customers to migrate to our services. This shift has resulted in a higher number of large enterprise transitions than we’ve witnessed in the past. Together, these factors created a distinct seasonal trend from Q2 to Q3.

We believe this upward trend is likely to persist. The pipeline indicates sustainability, and it’s our responsibility to convert these prospects into actual business.

Doug Clark — Vice President, Investor Relations

Operator, please proceed to the next question.

Operator

Our next question comes from Rob Owens with Piper Sandler. Rob, you’re up.

Rob Owens — Analyst

Thank you for taking my question. I am interested in your performance with larger clients and the success of selling multiple platform elements. Could you share your insights from a broader market perspective?

Tomer Weingarten — Chief Executive Officer

We are evolving our strategy. Our approach now focuses on offering the entire platform or multiple components rather than just one component. This proactive engagement is a recent shift for us.

We’ve always pursued upselling and cross-selling, yet the current trend demonstrates that we are reaching our largest enterprise clients more successfully. This is evident from the increasing average deal sizes and the record number of clients surpassing $100K and $1 million in contract value.

Our ability to serve high-end enterprises is essential, as we see a gradual movement away from established competitors in the market. Moreover, our AI SIEM, or data analytics capability, stands out, especially in the existing economic backdrop. Companies remain vigilant regarding their budgets but see value in our analytics solutions, which offer substantial cost savings.

Cybersecurity threats remain prevalent, ensuring an ongoing demand for top-tier security solutions. These dual dynamics, even amid macroeconomic challenges, suggest a promising outlook for our market strategy.

Operator

Our next question comes from Saket Kalia with Barclays. Saket, your line is now open.

Saket Kalia — Analyst

Thanks for taking my questions. Tomer mentioned the partnership with Lenovo, highlighting its potential. Can you elaborate on when this partnership might start contributing to our annual recurring revenue (ARR) and if its impact will be consistent or seasonal?

Barbara Larson — Chief Financial Officer

Thank you for the question. The Lenovo partnership is set for a multi-year engagement, and we’re currently in the early stages. We’re optimistic about its long-term prospects, as it is a strategic collaboration that will evolve over time.

We are working closely with Lenovo to establish various market strategies, including pre-installations and managed security offerings. This partnership builds on our existing reseller agreement and aims to deepen our collaboration. We expect revenue contributions to increase significantly in the latter part of next year as Lenovo rolls out pre-installed units and as we enhance co-selling efforts across our regions.

Operator

Our next question comes from Shaul Eyal with TD Cowen. Shaul, you’re on.

Shaul Eyal — Analyst

Hi, good afternoon. Tomer and Barbara, I noticed that you slightly revised your annual guidance. While I understand you don’t typically discuss RPO metrics, I saw it increased by 24% year-over-year and only 4% sequentially. Can you provide some insights on RPO trends, including pricing and contract duration?

Barbara Larson — Chief Financial Officer

Of course, I’ll address that. For Q3, our RPO experienced strong year-over-year growth of 25%, aligning closely with our total ARR growth. It’s important to note that last year, we secured a number of significant long-term contracts which makes this year’s comparison more challenging. While RPO is subject to variations based on contract lengths, ARR gives a clearer picture.

Tomer Weingarten — Chief Executive Officer

When discussing pricing, our ability to sell a complete platform has altered perspectives on pricing strategy. There isn’t a single price point in the market at this stage. Our prices have remained stable, as reflected in our strong gross margins, which are among the best in the industry.

We’ve noted that certain competitors are heavily discounting their offerings. While this strategy might aid those vendors in retaining customers, we pride ourselves on maintaining transparency and flexibility in our pricing approach, which helps us secure deals consistently.

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Understanding the Current Dynamics of Cybersecurity Markets

In today’s cybersecurity landscape, price isn’t always the most important factor. Companies like SentinelOne emphasize the value they provide and the cost savings they create for their customers.

Operator

Next, we have Tal Liani from Bank of America. Tal, your line is open.

Tal Liani — Analyst

Hi, thanks for taking my question. How significant is vendor financing right now? We’ve noticed that Palo Alto is adopting it aggressively, and CrowdStrike seems to be following suit. Is this a necessity, or are customers increasing their demand for it? Also, could you clarify your expectations for net new ARR in Q4?

Tomer Weingarten — Chief Executive Officer

Regarding financing, we don’t see significant external demand. Traditionally, financing in this sector has been handled by our channel partners, who often assist customers with financing solutions. We occasionally engage in financing, but our main focus is on meeting current customer needs rather than future commitments. Customers typically find what they need within our existing capabilities. If financing becomes necessary, we collaborate with trusted partners to facilitate that.

As for net new ARR, I can assure you that we’re experiencing strong momentum. We anticipate positive growth during the second half of the year.

Tal Liani — Analyst

Thank you.

Operator

Our next question is from Brian Essex at JPMorgan. Brian, your line is open.

Brian Essex — Analyst

Good afternoon, and thanks for taking my question. It’s encouraging to see reacceleration in ARR. First, Tomer, you’ve mentioned a focus on acquiring new logos instead of expanding the existing ones. Can you share where you’re currently holding back on investing in customer expansion? Secondly, Barbara, could you elaborate on the one-time legal settlement costs reflected in the non-GAAP financials?

Tomer Weingarten — Chief Executive Officer

We’re not actually holding back significantly on anything. Our sales teams continue to prioritize acquiring new accounts over upselling within our existing base. However, we recognize that there’s potential for growth in our existing customer relationships, particularly with adjacent solutions. We are developing playbooks to leverage these opportunities in the coming year, aiming for gradual growth in that area.

Our objective remains clear: to provide valuable solutions tailored to customer needs, whether it’s endpoint security, cloud, or data analytics. Currently, most ARR growth stems from new account acquisitions, which is our focus now, but we’ll naturally balance this with more effective strategies for penetrating our existing customer base.

Barbara Larson — Chief Financial Officer

Concerning the Q3 operating margin, it was affected by one-time legal settlement costs and legal fees amounting to several million dollars. Excluding these costs, our margin would have been negative 3%, aligning with our Q3 guidance. These legal expenses stemmed from past M&A activities. We decided to settle proactively to avoid prolonged litigation and better manage future costs.

Operator

Next up, Joe Gallo from Jefferies. Joe, your line is open.

Joseph Gallo — Analyst

Thanks for the opportunity. Barbara, while you aren’t providing guidance for next year yet, could you share any changes you’ve implemented in the guidance process at SentinelOne? Additionally, Tomer, what insights can you provide regarding how customers are planning their budgets for 2025?

Barbara Larson — Chief Financial Officer

Our guidance philosophy focuses on setting clear and reasonable expectations based on our business’s potential. We rely on current pipeline activity, contributions from new products, and anticipated conversion and win rates.

Tomer Weingarten — Chief Executive Officer

When discussing budget considerations, it’s clear that customers are prioritizing cost savings. Many seek to enhance their cybersecurity capabilities to combat emerging AI threats—a significant shift from previous years. They are looking for solutions that not only address these threats but also modernize their infrastructure for a quicker response, aiming for greater resilience and reduced disruption. Overall, customers are strategizing their investments to achieve these objectives.

SentinelOne Reports Strong Enterprise Momentum Amid Market Challenges

Focus on Cost Savings and Cloud Solutions

Recent financial discussions emphasize that many businesses are paying closer attention to how specific vendors and technologies can drive cost savings. SentinelOne, a leader in AI-driven cybersecurity solutions, highlights the significant advantages of cloud-native systems over traditional on-premise or transitioned cloud solutions, which often underperform.

Analyst Insights from Needham

The next question comes from Matt Dezort with Needham and Co. Matt, you have the floor.

Matt Dezort — Analyst

Thank you for taking my question, and congratulations on your results. Tomer, you mentioned an increase in enterprise displacements this quarter. Can you elaborate on whether the pipeline indicates sustained momentum? Additionally, how are pricing and discounting trends impacting these conversations, especially following the July 19 market outage impacting 50% of existing customers using legacy AV?

Tomer Weingarten — Chief Executive Officer

We are confident that our pipeline supports ongoing growth in the enterprise sector. The discussions we are having now are larger and more significant than those from the past. Pricing remains a strength of ours, enabling us to compete at any price point. We typically operate with a gross margin around 79% to 80%, which is optimal for our market.

Looking ahead, we intend to be aggressive while maintaining our margins and increasing our average contract size. This strategy has been successful, especially with major financial institutions keen on addressing challenges with their existing platforms. They view SentinelOne as a leader in technology.

Leading the MITRE evaluation for four consecutive years is a commendable achievement, and this trend is likely to continue. The focus isn’t solely on pricing or any isolated event like the July 19 outage; it’s about showcasing our technological leadership, particularly in AI capabilities. This is evident in our growing market share in endpoint protection and the performance of our Purple AI technology.

Continuing Questions from Baird

The next question comes from Shrenik Kothari with Baird. Shrenik, you’re on.

Shrenik Kothari — Analyst

Thanks for taking my question. Congratulations on the new ARR milestones. Tomer, Barbara mentioned that ARR per customer reached a new high this quarter, driven by success in large enterprises. Can you explain how macroeconomic factors, such as constrained IT budgets and the recent outage, might influence sales cycles? Are larger deals extending the sales cycles?

Tomer Weingarten — Chief Executive Officer

In general, macroeconomic factors seem fairly consistent. I don’t believe there has been a significant change in how customers approach spending. The July 19 outage is just one aspect of our current landscape. Overall, our robust technology continues to drive our business forward. Recently, the discussions we engage in showcase our technology’s capabilities, easing customer transition from legacy solutions. Larger contracts naturally result in longer sales cycles, a trend we have experienced before. We’re adapting to these cycles and see it positively influencing our strategy in the enterprise market moving forward.

Mid-Market Performance Discussion

The next question comes from John DiFucci with Guggenheim. John, your line is now open.

John DiFucci — Analyst

Thank you. Tomer, while enterprise sales have longer cycles, how is the SMB and mid-market segment performing? This quarter’s results seem to suggest improving momentum, which may have exceeded some investors’ expectations. Could you comment on this segment’s performance?

Tomer Weingarten — Chief Executive Officer

Yes, our SMB and mid-market sectors are performing well, with noticeable growth momentum. Our Managed Security Service Provider (MSSP) partners are also expanding successfully. It’s challenging to separate the effects of recent outages from our inherent growth, but we’re witnessing enhancements across the board, geographically and across various verticals. While we always strive for more, our main focus remains on enhancing performance in the enterprise market. Positive signs are evident in both SMB dynamics and our partnerships, as we see improved win rates and acceleration in those areas.

Expansion in MSSP Products

The next question comes from Trevor Walsh with Citizens JMP. Trevor, you’re on.

Trevor Walsh — Analyst

Hi, team, thank you for your insights. Tomer, regarding the MSSP segment, can you expound on the gradual product release, particularly around CNAPP, as mentioned in your shareholder letter?

Strategic Insights from Tomer Weingarten on Enhancing Partner Enablement

Understanding the Dynamics of Partner Capabilities

Tomer Weingarten — Chief Executive Officer

Absolutely. Our focus is primarily on enabling our partners. We must ensure that our products align well with the multi-tenanted approach we’ve established in the endpoint market over the years.

Adjustments are necessary in our playbook and training programs to guarantee our products are suitable for this market segment. Not every capability we have is equally significant in this area compared to the endpoint domain. Ultimately, our goal is to empower both end customers and our partners with the necessary capabilities. The responsibility lies with us to facilitate this empowerment.

Expanding Our Teams and Technologies

We also have to help our partners articulate the value proposition to their customers, which we believe will evolve over time. Recently, we’ve significantly expanded our Managed Security Service Provider (MSSP) team. We’re now focused on leveraging our data lake technology and Purple AI within the MSSP market, as we view these innovations as particularly well-suited for this segment—potentially even more so than our Cloud-Native Application Protection Platform (CNAPP) capabilities.

Tailoring Solutions for Different Market Needs

When considering the market, we must think about what will create the most momentum in this segment, knowing it differs from selling to large enterprises. For example, large enterprises typically manage a different scale of workloads, staffing, and automation needs.

Therefore, we’re making adjustments to align our offerings appropriately and will continue to support our partners in achieving success in their markets.

Operator

Now, I will hand the call back to our hosting team for concluding remarks.

Tomer Weingarten — Chief Executive Officer

Thank you all for joining us today.

Operator

This concludes today’s conference call. Thank you for your participation. [Operator signoff]

Duration: 0 minutes

Call Participants:

Doug Clark — Vice President, Investor Relations

Tomer Weingarten — Chief Executive Officer

Barbara Larson — Chief Financial Officer

Brad Zelnick — Analyst

Gray Powell — Analyst

Rob Owens — Analyst

Saket Kalia — Analyst

Shaul Eyal — Analyst

Tal Liani — Analyst

Brian Essex — Analyst

Joseph Gallo — Analyst

Matt Dezort — Analyst

Shrenik Kotharia — Analyst

John Difucci — Analyst

Trevor Walsh — Analyst

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