I know we’ve also had questions in the past too about an add-on. There’s — I don’t think the sort of initial launch is going to involve that, but it is something that we’re thinking about may show up in the future, certainly paying attention to how a lot of the other enterprise products are starting to monetize and we want to learn from what works and doesn’t there. So in the short run, I think the main thing you’ll see is that it’s helping up to your customers through the packages is the main monetization advantage as well as highlighting the differentiation of Asana in the first place that we win more deals.
George Iwanyc: All right. And maybe just, Tim, quickly following up on that. When you think about investing and hiring with the AI productization and ongoing enterprise investment, how should we think about the near-to-moderate term plans?
Tim Wan: Yes. I mean I think, one, we’ve made really substantial progress on our operating margin, but we’ve taken a very balanced approach in terms of how we’re investing and how we’re trying to get to profitability. So I think at a macro level, we’re going to continue to invest in AI. That’s one. Two, and to the degree that we see improvement in productivity and efficiency across our sales and marketing organizations, we’ll be able — we’ll feel more confident pouring more investment in that area.
Operator: Thank you. Our next question comes from the line of Jackson Ader of MoffettNathanson.
Jackson Ader: Great, thanks guys. Thanks for taking our questions. Dustin, you mentioned early or in the call, some of the other AI winners that are kind of your neighbors in the Bay area. And I think — some of the early winners at least from an investor standpoint seem to be some of the largest technology and some of the largest software companies out there that are kind of publicly investable. And I’m curious how you see Asana fitting into the AI landscape among some of these tech giants, I guess, for lack of a better term.
Dustin Moskovitz: So I think there’s a couple of different ways to think about that. So earlier, I was really talking about the foundation model builders primarily, so OpenAI and Anthropic and our relationship to them is we’re customers. So we’re adding value on top of their underlying infrastructure. They’re doing — we’re very grateful they’ve made a huge CapEx investments that weeks to leverage just in terms of marginal API fees. And so we’re really building on their platform. And I guess I’m not totally sure who you mean by the other large public companies. I mean, certainly NVIDIA is a very different kind of company. And then it’s very different. I think a lot of the public stocks that have taken off the cloud to compute providers.
So again, we’re kind of customers in their stack. But I think that Asana will be part of a sort of second generation value creation that’s really figuring out how to integrate those services into existing workflows where I think they can be a lot more powerful. So what people are familiar with right now is basically these open-ended chat applications where you can kind of ask anything you want, and that’s very powerful and very flexible, but most people in the world really want to be kind of shown what works best and particularly in something like work management, we’re finding that the kinds of requests we’re making to the API are highly structured, highly templatized. We’re also educating the user about what kind of questions work best, often, they sort of start with very generic, what should I know about this project or something very open ended.
It’s much better to get specific. And so the more we’re able to provide people with some templatized options and some multistep workflows that help lead them to the most powerful value, the more I think people actually be able to get value from those underlying platforms. So I think of us as a sort of value creation on top of those underlying foundations.
Jackson Ader: Okay. Okay. Great. That’s helpful. And then the follow-up is it for, I guess, Tim or Anne Whoever wants to take it. But the low-end weakness, do you think it’s — maybe has more to do with the fact that since Asana is moving resources upmarket that kind of competition is filling the void left behind? Or is there something also happening in budgets or something on the macro sense in the low end that’s not holding up as well as maybe some enterprise budgets? Thank you.
Tim Wan: Great question. I think, one, I would say, I think the way you characterize that, we did redeploy a lot of our investments away from the lower end of the market and focused those investments towards the upper end is one of the reasons where kind of like our less than 5,000 customer — revenue from that customer cohort is growing slower than customers with more than 500,000. So I would say that’s one. Two, obviously, I think the collaborative work management category is still very much greenfield and there’s just a lot of runway. So it’s not necessarily winner take across all of these segments. So to the degree that we move up market and other players end up staying in the lower end of the market, I think that’s a very likely outcome in the long-term.
Operator: Thank you. Our next question comes from the line of Alex Zukin of Wolfe Research.
Alex Zukin: Thank you, guys for taking the question. Maybe just the first one, Dustin, for you. I’ll ask it. It’s kind of a similar question on the AI front. But I guess if we step back for a second and we think about where and how you think people specifically customers are going to actually pay for the AI functionality that you’re introducing for the way that you’re positioned and how investors in Asana are going to benefit from the investments and the experience that you have. Is it more — and also in the context of like availability of GPUs, when you’re launching the product functionality, when do you expect folks to actually be able to see the ROI from it? Like just conceptually, what are people willing to pay for, not willing to pay for, at least in the [Indiscernible] conversations you’re having?
And when would you expect with your ability to actually deliver this product to market in a way that enables the ultimate monetization opportunity and also the impact on retention that’s likely to have.
Dustin Moskovitz: Yes. Thanks for the question. I think it’s a little difficult to answer because I don’t really think of it is binary in that way. So it’s not a feature we’re launching and delivering, but a sort of unfolding of our road map. And in a lot of ways, it’s already begun because we already have customers in the private beta, we’ll be launching into a much more open beta alongside our events in October with some of the functionality. But we also have teams working on what’s next and putting more customers into the beta features beyond that. And we’re also talking about our road map with customers when we’re briefing them, and it’s part of the purchase decisions they’re making when they think about what partner they’re going to want for the long run.
A lot of it has to do with who can differentiate on that AI vision. And I think it’s helping us now, and it will continue to help us more. I think the October event is a particularly big moment for us to tell the story, especially in a visual way. It’s hard to get across on these earnings calls. And so I think it will — we’ll just like continue to build again, just in terms of like a packaging moment, I think it will present itself most in terms of customers up-tiering to get the more advanced AI functionality. There may even be a benefit from free to premium. We’ve kind of debated that internally but haven’t really modeled anything. And so it will happen in pieces and get better and better rather than being a single moment where there’s an inflection in the revenue.
Anne Raimondi: Sorry, are you asking about customer feedback as well. So I just wanted to add a couple of things in terms of what we’re hearing from customers. In the conversations with CIOs at our largest customers, whether that’s a global live events company or the leading vacation rental platform in the world, what they’re telling us is, first and foremost, they’re excited to have a strategic partner to help them build out their AI strategy because right now, it does feel overwhelming the number of choices out there. And so things that they care about are data specifically, where it comes from, how it’s used. They care very much about security and they care a lot about transparency in how AI is deployed. And so for work management, in particular, it’s very straightforward for them to see how AI will accelerate what they’re already trying to do, whether that’s in projects or portfolios or connecting that work to goals.
And so more than anything, our conversations really are starting to be how we can help them really figure out their AI strategy and then be able to deploy it in Asana. So we’re really excited about the early feedback and the desire for customers to help us shape the road map. And how engaged they are. So I just wanted to share a little bit more of that color.
Alex Zukin: That’s super helpful. And then maybe, Tim, a similarly open-ended question for you on the numbers. Again, if we look at some of the commentary, it suggests that multiyear deals were strong, enterprise traction continues to be really positive. So I’m trying to square that with the forward-looking metrics. Like if we look at billings, it’s kind of in the low-teens growth this quarter. The RPO bookings kind of similarly in that low teens kind of dimension. So is there anything that is kind of onetime in nature specifically that we should be paying attention to? Because your guidance for Q4 kind of implies you’re exiting the year just over double-digit growth. The Street has you doing something a lot better than that for next year.
So given the commentary you made around the six to nine months of kind of still having that renewal headwind within these large tech companies like when should we see kind of the turn happen? Is that a Q1 phenomenon? Q2? And how do we think about that?
