I thought this was a great quarter honestly.
Just running through the numbers, here are the last 5 quarters of YoY revenue growth:
And here are the QoQ numbers:
You’ll notice that there is a slowdown in the latest QoQ number. So shouldn’t that be worrying?
Well, maybe not because the Q1 guide was very strong.
For the last two quarters, SentinelOne has guided for 9% QoQ growth. But Q1 is for 14%!
Putting it another way, the company added $9.6 million in revenue this quarter and without beating the high end of their guidance, they will do $9.4 million in revenue.
I wonder if they’ll speak to that dynamic on the call. This quarter seemed a tad light but next quarter already seems to be shaping up very strong.
Moreover, the full-year guide is for 81% at the high end. I think it’s quite likely that they will do more than 100% YoY with the standard beats and raises. One important thing to point out is that the guidance doesn’t include any contribution from Attivo.
From the shareholder letter, we found out that Attivo does about $30 million in revenue and is growing over 50%. The acquisition (58% in cash and 42% in stock) is expected to close in Q2.
So if the acquisition does close in Q2, let’s say that SentinelOne can recognize two full quarters of Attivo revenue. My guess is that would be at least $25 million in revenue so that means SentinelOne would grow at least 93% without any beats and raises from their current fiscal guide. But we know that isn’t super likely. That’s why I have pretty high confidence they will grow more than 100%, maybe even 110% if we include the Attivo contributions.
And here are some more recent numbers:
Non-GAAP operating margins
I think this was my favorite thing from the report. Look at the YoY difference in FCF margin! YoY it went from -86% to -11%!! That is just awesome. If anyone was having doubts if SentinelOne could ever be FCF positive, that is some serious evidence.
And here are the QoQ net new 100k customer additions:
YoY ARR growth:
QoQ ARR growth:
Lastly, here are some interesting quotes from the shareholder letter:
In the fourth quarter, we added a record number of $100K plus ARR customers, a record number of million-dollar plus ARR customers, and closed our largest ever net new customer contract – one of the most influential and leading global internet companies.
over one-third of our fourth-quarter new business was driven by our Singularity modules and DataSet, up from about 20% last year. Our Cloud and Data Retention modules achieved the highest growth, each delivering phenomenal year-over-year growth of over 10X.
Attivo is a premier and highly differentiated solution that will enable us to provide cybersecurity in one of the most critical and dynamic parts of enterprise security today, the identity perimeter. We believe it is the best and most comprehensive identity security platform in the market today. With Attivo’s user-centric identity capabilities, we will be able to support an even more holistic zero trust framework.
Building upon the acquisition of Scalyr, we launched DataSet in February 2022, a revolutionary live enterprise data platform for data queries, analytics, insights, and retention. DataSet expands our capabilities beyond cybersecurity use cases.
For instance, in one of many of our recent joint solutions, Zscaler data is ingested into Singularity XDR and can then be queried and filtered, allowing security teams to quickly triage and respond to attacks. This seamless integration enables enhanced end-to-end visibility, contextual awareness on abnormal activity, automated response, and conditional access
In the fourth quarter, Mandiant selected SentinelOne as a global go-to-market partner. Mandiant is one of the world’s leading IR firms and this strategic alliance brings the best of both worlds to our joint customers – top incident response consultants leveraging the best-in-class XDR platform
I thought this was a good quarter overall and growth isn’t slowing as much as the 17% QoQ growth would make you think. I mean without any beat at all, QoQ growth will be 14% QoQ next quarter.