JFrog Ltd. (NASDAQ:FROG) Q3 2023 Earnings Call Transcript

They selected the JFrog platform’s end-to-end capabilities, allowing them to build faster using JFrog Artifactory as a single source of record with high availability and efficient redundancy across their entire software development life cycle. They further noted a need to deliver more robust policy management capabilities at scale and bring comprehensive security to their complete pipeline processes. We look forward to partnering with these customers to achieve their goals of on-prem to cloud migration, developer experience upgrades, high availability, universal binary management, and a comprehensive software supply chain security implementation. This use case reflects a growing trend of enterprise-wide adoption of the JFrog platform and long-term standardization on JFrog DevSecOps technologies.

At our recent user conference SwampUP, customer speakers from global companies such as Fidelity, Netflix, Capital One, and eBay, just to name a few, all reflected a common trend. A single source of record of your software supply chain requires complete management and control of binaries. A platform that is binary-centric from end-to-end is the only way to automate and secure with speed. On that note, I would like to address adoption of our holistic security solutions and the customer trend of tooling consolidation. It’s a fact that the software supply chain flow is the flow of binaries, meaning through security can only be achieved with complete control of both binary release cycles as well as binary contents, dependencies, and metadata. JFrog continues to deliver security solutions into the market that are aligned with new attack threats and consolidations of point solutions under one vendor.

For example, JFrog Curation, released in July and keynoted at our SwampUP conference, addresses the real pain of the enterprise around the secure consumption of open-source technologies coming from public repositories. In addition, the new release of JFrog Catalog provides a listing of over four million third-party software packages stored in public repositories, solidifying JFrog as a single source of truth for the holistic secure management of software packages. While companies’ blind spot may be the security of open-source and third-party packages, binaries are also built by in-house developers writing first-party code. To achieve end-to-end security coverage, JFrog is taking the security of software releases a step further to the left with the general availability of code scanning capabilities, often known as Static Application Security Testing, or SAST.

With these announcements in Q3, JFrog is the first solution in the industry to deliver end-to-end software supply chain security, providing customers complete coverage from code to production. JFrog code scanning with the new SAFT solution protects first-party code. JFrog curation protects companies from unwanted third-party packages from entering their organizations. And JFrog Catalog provides metadata and augmented information about the Company’s binaries. Together with JFrog X-Ray and Advanced Security for Secret Detection and Contextual Analysis, JFrog is the only Company that delivers complete security solutions with a binary-centric approach. Combined with Artifactory, the leading binary repository, JFrog provides a complete DevSec Ops solution for your software supply chain.

This end-to-end security approach continues to gain traction across verticals. For example, one of the world’s largest biotech companies recently adopted our entire security offering on the JFrog platform. Looking to consolidate point solutions, they saw the value of having software supply chain security integrated with their binary management system. We look forward to helping them address their software supply chain security needs holistically. As they tell us, they intend to migrate away from point solutions such as MEND in their tool stack. In another highly regulated industry, a nuclear security group within the United States Department of Energy recently acquired the JFrog platform to improve their software supply chain security posture.

One of the cybersecurity specialists in the Nevada National Security Site Team, Brian Walkman, noted, a software supply chain platform is necessary for a practical means to meet certain governmental and standards requirements. More importantly, security at all stages of a software development life cycle is necessary for national security interests. Our response is, JFrog does that. Next, I would like to address growth in cloud adoption, marketplace channel growth, and our strategic sales motions. The expansion in the number of our over $1 million ARR customers this quarter demonstrate the continuing focus of our strategic sales team on driving large-scale software supply chain platform implementation with the key partnership of the major cloud providers.