Domo, Inc. (NASDAQ:DOMO) Q3 2023 Earnings Call Transcript

Bruce Felt: We are actually still building sales capacity, on the one hand with the metric that we call ramped sales heads. One of the challenges we have on the numbers is, however, we’ve kind of had a mixed change in the business, in favor of the corporate sales reps, and they just generally have lower quotas. So from a headcount point of view, we’re doing fine. We just had to work that through the system and rebalance in a way where we have the kind of the quota capacity of the street to be commensurate with the headcount. And we do have plans to get that rebalance kind of as we go into next year. And while I’m at it, we think we’re in a good position to really get the enterprise being a much bigger contributed to next year, we have great reps that are here, they know their accounts well, extremely engaged.

The value proposition seems to be showing even better in this economy, even though we have to deal with the budget challenges of our customers on the one hand, but we have the right kind of architecture and approach. And the Modern BI that’s just going to play well. And we think the large enterprises can actually be tailwind to us next year. So yes, we look forward to getting into next year.

Derrick Wood: Wow! I was going to ask a question about the enterprise. I didn’t expect that answer. That’s good to hear. But I imagine that when I’m looking at your Q4 guidance, and I mean, you have revenue down sequentially. Maybe there’s some professional services volatility in there. But is it fair to say, how come we’re not seeing more seasonal strengthen in revenue in Q4. Is it just because you don’t have the level of enterprise business, which is typically a big Q4 seasonality as you did a year ago, and so that’s a tougher comp. But once we get through that, we should start to see it better. And second half, maybe you could walk through the puts and takes on the Q4 guide for revenue.

John Mellor: Two main items, one is, we’re being very cautious in the new business and the contribution to new business and the revenue contribution. Well, I’ll even add to that reason, being cautious in the renewal rate. And the revenue we get out of that we think is just that prudent. It’s prudent do so given these numbers are quite large, going into Q4. And then we don’t have factored in the same number of like, service delivery, hours and app delivery. It’s possible — if it is commensurate with what we’ve seen just recently, there’s some upside there. But it’s not baked into the number as we sit here right now. So that’s why it’s really services driven, I would say in terms of like, what’s really causing that.

Derrick Wood: Got it. Okay, thank you.

John Mellor: Typically a big deal quarter and we’re being conservative when we look at these deals.

Derrick Wood: Thank you.

Operator: And our next question will come from Pat Walravens with JMP Securities. Please go ahead.

Pat Walravens: Oh, great. Thank you. Bruce, we’re sorry to see you leave. When did you decide that it was time to leave?