Asana, Inc. (NYSE:ASAN) Q3 2023 Earnings Call Transcript

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Allan Verkhovski: Okay. Got it. And then just as a follow-up to that point, like were to disaggregate the expansion business and the net new business. Like from our seat would assume expansion deals are a little easier to get over the line in this environment, but that’s kind of an inconsistent thought depending on other SaaS providers in the space. So what are you hearing from your reps about these areas? And how does that affect your strategy for next year?

Dustin Moskovitz: Maybe I’ll start and Anne might jump in. I mean, it’s €“ it’s a little of both. I think — and it depends on the segment. So probably in the smaller segments, SMB and mid-market, maybe a little more pressure against conversion and jumping into something new, a new category they haven’t been spending on before, but not too dramatic. And then expansion, more with the enterprise customers, they €“ it’s not even necessarily that they aren’t expanding, but maybe they’re just being a little more modest about it. There are a couple of cases where customers were doing risks and some of the roles that were eliminated had license seats simply repurpose them to actually expand usage in other parts of the company. And so in some sense, they were expanding, it just wasn’t necessarily translating into dollars for us.

And then similarly, all of the currency headwind really shows up in sort of €“ what turns out to be negative renewals even if the seats are still there. And we’re still €“ and we’re heavily driven based on those trends and just on seat expansion. So I don’t think, there’s anything that stands out too much. When I think of where our internal forecasts were most off, it was in those more modest expansions relative to what we were hoping for.

Allan Verkhovski: Thank you.

Anne Raimondi: Yeah, I’ll just €“ the only thing I’ll add to that is, our champions are still quite engaged with us on those expansions. And so a lot of the focus in the discussions really is where can we make the highest impact and deliver the highest ROI and in the shortest amount of time. So, some of it is just reevaluating together where we expand the deployment and which cross-functional use cases.

Operator: Thank you. Our next question is from the line of Steve Enders with Citi. Please go ahead.

Steve Enders: the question here. I guess, I just want to ask on the €“ both expansion within that largest customer, not expanding up to, I think it’s 150,000 seats. I guess, just wondering, as we think about that account €“ what were kind of the incremental, either use cases or areas that you are beginning to see that expansion take place in? And I guess, how should we think about kind of further scalability that you could capture within that account there?

Anne Raimondi: Yeah. Thanks so much for that question. I think what we’re actually seeing in that account is expansion across many different divisions and departments. It’s a large global organization and so we are deployed in €“ across many functions, many business units. And really, what we’re seeing that drives that growth is that their €“ it’s really how many of the organizations work and how they onboard new employees, how they train their employees, how they deploy even for their end customers. And so they’re codifying essentially how they intend to collaboration to work within the organization. So it’s not so much sort of one specific use case, but rather that we are now part of the stack of collaboration in that organization.

And so we’re excited to see that, because I think that really is playbook that we feel we can replicate in a lot of our large enterprise customers that are starting to see that similar behavior, where it’s across multiple departments, it’s across multiple divisions, and it’s really facilitating those cross-team initiatives that are so critical right now.

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