Good afternoon, and thank you for joining us to discuss PagerDuty's fourth quarter and full fiscal year 2025 results. With me on today's call are Jennifer Tejada, PagerDuty's Chairperson and Chief Executive Officer; and Howard Wilson, our Chief Financial Officer. Before we begin, let me remind everyone that the statements made on this call include forward-looking statements based on the environment as we currently see it, which involve known and unknown risks and uncertainties that may cause our actual results, performance or achievements to be materially different from those expressed or implied by the forward-looking statements. These forward-looking statements include our growth prospects, future revenue, operating margins, net income, cash balance and total addressable market, among others, and represent our management's belief and assumptions only as of the date such statements are made, and we undertake no obligation to update these. During today's call, we will discuss non-GAAP financial measures, which are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. A reconciliation between GAAP and non-GAAP financial measures is available in our earnings release, which can be found on our Investor Relations website. Further information on these and other factors that could cause the company's financial results to differ materially are included in the filings we make with the Securities and Exchange Commission, including our most recently filed Form 10-K/A as well as our other subsequent filings made with the SEC. With that, I will turn the call over to Jennifer.

Thank you, Tony, and good afternoon, and thanks for joining us today. I'm proud to share that PagerDuty delivered our third consecutive year of non-GAAP profitability, demonstrating the fundamental strength and durability of our business model. We achieved 9% annual growth in both revenue and ARR while expanding our non-GAAP operating margin by nearly 500 basis points to 18% -- with free cash flow margin expanding from 15% to 23%, we see the culmination of the fiscal year as a clear testament to our operational discipline and efficient growth strategy. Looking at Q4 specifically, I'm pleased to report we exceeded our guidance ranges, delivering $121 million in revenue and a strong non-GAAP operating margin of 18%. We added $11 million in incremental ARR, bringing our total annual recurring revenue to $494 million. While we're seeing some near-term moderation in growth as we evolve our enterprise sales transformation, the fundamental drivers of our business remain strong. Our strategic position at the center of digital operations gives me confidence in our ability to build momentum into the second half of the fiscal year. Enterprise traction continues to improve as we execute on our strategic shift towards multiyear multiproduct platform partnerships. The power of our Operations Cloud is evident in expanding product adoption with multiproduct customers now driving 65% of total ARR, up from 62% last year and marking a substantial 7 percentage point increase since fiscal 2023. These customer relationships continue to validate our strategy with 72 customers now exceeding $1 million in ARR and 849 customers investing more than $100,000 annually. Most notably, ARR from customers spending over $100,000 grew 12% year-on-year, now representing 71% of total ARR. The combination of our expanding platform capabilities, strong customer relationships and significant headroom for growth within our installed base underscores the opportunity ahead…

Thank you, Jen, and good day to everyone joining us on this afternoon's call. Unless otherwise stated, all references to our expenses and operating results on this call are on a non-GAAP basis and are reconciled to our GAAP results in the earnings release that was posted on our Investor Relations website before the call. As Jen articulated, we expect the catalyst for higher performance to be consistent improvements in sales productivity. Over the past 12 months, we have successfully reconfigured our sales organization to be an enterprise-focused sales team, hiring to the right profile of quota carriers while remaining within the existing expense envelope, a strategy we will maintain throughout FY '26. With a significant portion of quota carriers joining in the second half, our focus has shifted from hiring, onboarding and enablement to rigorous account management and sales execution. As a greater mix of our field becomes fully ramped in proactively championing the Operations Cloud, we are laying the foundation for increased momentum in the second half. Today's announcement of a new $150 million share repurchase program is a clear signal of confidence from our Board and management team in the FY '26 plan and the durability of our free cash flow. Please note, the $100 million repurchase program announced in Q2 of FY '25 was completed during the fourth quarter. Moving to results. Revenue for the quarter was $121 million, up 9% year-over-year. International revenue increased 10% annually, contributing 28% of total revenue. Annual recurring revenue exiting Q4 grew 9% year-over-year to $494 million. We delivered 106% dollar-based net retention, fractionally below our expectation for the full fiscal year. I'm encouraged by the improving trend of annualized gross retention over the past 4 quarters as well as enterprise dollar-based net retention continuing to outpace the commercial segment…

Thank you, team, Howard and Jen. [Operator Instructions] And we're going to turn first to Andrew Sherman at TD Cowen. Andrew, please go ahead.

Great. Thanks. Good to see you. Jen, maybe just given all the macro changes in the last 6 weeks or so, I would love to hear an update on what you're seeing in the market and any change to your business? I don't think you have much government business, but would love to hear any observations on that too.

Yes. I think it's too soon to tell whether the current tariff environment will have a derivative effect on how customers approach spending. So we've consistently seen customers looking for platforms with a higher ROI, short payback period and the ability to see true efficiency. And efficiency has been a theme in almost all of the large deals that we've done. Although I'd also say that our customers have matured their digital -- the digital aspect of their business such that when I talk to senior leaders, and I'm out in the market with our customers a lot, I'm hearing a lot more about revenue optimization. How do I ensure revenue capture. It's not just about making sure that your web apps are available, but making sure that a transaction can be completed that you actually have a value trade that is closed through that process. And so I think for us, it just is going to continue to be a focus on execution, making sure we're delivering great account engagement with our largest accounts that we understand the challenges that they're facing and that we have multi-threaded relationships with those customers. But at this point, we're kind of used to a volatile macro. So it's sort of business as usual.

Okay. Great. One more for you. We have a bunch of new sales leaders in the different regions. You're now looking for a CRO. You've kind of migrated everyone to the same enterprise playbook, but maybe just touch on how those reps are ramping to productivity, do you need to hire more reps? Any other go-to-market tweaks to start the year at all?

Sure. It's a great question. Thank you for that. So we made a number of leadership changes over the course of the year across many of our major theaters and those folks have now been in seat and really understand the product and platform and have also been leading what I'd call a talent rotation. If you think about it, historically, our enterprise play still leveraged our high-velocity land and expand motion, and we started with a single product and would add on other products. But buying behavior changed, and that required us to build more of a top-down platform value-led sale. And so part of the talent rotation that we've been through over the course of the last couple of quarters has been to identify top-down platform reps who have experience and a significant track record also with networks and relationships in our largest customers. And those hires where the profile has been updated, we're seeing them ramp faster than the existing cohort and become productive sooner, particularly around large deals. So we have a number of hires already made that will be ramped through the back half of this year. And I think that puts us in a good position from a capacity perspective. It's also fair to say, and I know our sales leadership team would say this is true. I am laser-focused on identifying opportunities for increased effectiveness and productivity as well as efficiency. So that's ramp, that's pipe conversion, pipe quality, making sure that we standardize the way we go to market, but also inspecting our largest accounts to ensure that our account engagement is -- meets the high standards that our customers expect because when we have strong account engagement, we grow, and we see the platform effect take hold.

Thanks, team. We are moving next to Koji Ikeda from Bank of America.

So maybe the first one there on the competitive front. We saw on the news out there that one of the legacy vendors tucked away in a large organization might be going end of life here pretty shortly. And so from a high level, how should we be thinking about this as a potential opportunity for PagerDuty?

Well, I think the first thing to think about is despite increasing competitive intensity, which has been primarily in the product marketing space and in the sales, side of things, we've continued to improve our retention levels. We also, I believe, have the strongest and most differentiated platform for large enterprise. But I'm not really surprised by this move because we've seen it before. We've seen it when other acquisitions have been made and then retired. And I think it just goes to some of the product differentiation and advantages that we've been able to demonstrate year-over-year, not the least of which that we're able to scale reliably and securely for large enterprise and deliver the type of resilience that these customers expect when it really matters. And that's hard to do. It's an expensive exercise, and we've been able to do it while delivering solid gross margins above 85%. I think when we -- I said this earlier, but when we do a good job from an account engagement perspective, and we're multi-threaded across both practitioners, but also strategic and economic buyers, we win very effectively. And so it's about scaling those standards for go-to-market, those standards for account engagement throughout our installed base and really going after the value capture and monetization of the platform innovation we've already invested on to capture some of that white space opportunity within the installed base.

Got it. And maybe a follow-up for Howard. When I look at the guide and I quickly kind of punch in numbers in our model. I think it does imply accelerating growth in the second half just based on the commentary too with the sales capacity. Is that the right way to think about the guide? And then outside of sales capacity ramping, what else are you seeing maybe in the pipeline that's giving you the confidence to guide like that?

Yes, sure. So thanks, Koji. And maybe just to give you how I've thought about guidance for this year, some of the building blocks for us. With us exiting the year with an ARR growth rate of 9%, I factored that into how we would see the evolution of ARR through the year, including incremental ARR being added through the year that would lead to an acceleration in the back half of the year. So you're quite right in terms of expecting that trajectory. When I look at Q1 in isolation, I would think that the incremental ARR that we will deliver will still result in a high single-digit level growth rate in ARR for Q1. So we're thinking about the phasing as the hiring that we did in the back half of the year comes fully online to be able to then support the higher growth through the back half of the year. What gives me confidence in that is, one, we've seen improved management of both our pipeline from a velocity and from a quality perspective. And we expect the initiatives that we have around that to continue with the sales leadership that we have brought on board recently. And then I think the other aspect of it is when I just look at the numbers in terms of the success we've had with customers above $100,000, where we've had a growth rate in ARR of those customers of 12% year-over-year, and we've seen the -- that become a larger portion of 71% of our ARR. It proves that the strategic focus that we have on the enterprise is what really is going to underpin our growth. So those factors together have been factored into how we've thought about guidance for the year.

And we're moving next to Sanjit Singh from Morgan Stanley.

And just talking about some of the metrics on how the business is evolving. You're now getting 30% of your ARR outside of Incident Management. I'm wondering if you can provide any color and detail on what offerings are sort of leading the charge in that 30% bucket? Number one. And then, Jen, PagerDuty Advance, what is that doing to your deal sizes from an uplift perspective when they are included in your renewal or expansion opportunities?

Sure. So from a product perspective, AIOps has really been an important attach product for us because unlike some of the point solutions out there or some of the observability plays that you'll see, our AIOps solution is deeply integrated into the entire operational workflow from detection to automated triage, the orchestration of bringing the right people into a response and increasingly the right agents into a response and then the automation all the way through to resolution, right? When you try and use a point solution or you just look at it from an insights perspective, you're not actually closing the loop on the work that has to get done to both prevent financial challenges or costs in your business, but also to -- in order to optimize the revenue that you're trying to generate through your digital assets. So that, I think, has been a really important and strategic plan for us to continue to grow not only how our customers invest with us, but how they think about the platform. Automation is another, and automation isn't just the product process automation solution that we have, but also automated incident workflows across the board. And I think the role that PD Advance is playing is really helping our responders to compress the amount of time it takes to diagnose the triage and then respond to an incident to also be more efficient in how they communicate more broadly with the organization and with their customers about what are happening. And so right now, it's more of an efficiency builder. But as customers get used to using it and we drive more features through PD Advance as well as agents, I think you'll start to see that have an impact on growth. And you'll recall that we are testing -- or actually, we're in market with consumption-based pricing in this case. And so I think it's a really good complement to the current flexible pricing model that we have.

And that makes a ton of sense. My one quick follow-up was, when we looked at some of your customer highlights this quarter, I saw the term multi-year agreement, right, kind of across the board. Is that a shift? Is this part of the upmarket shift that you guys are making? Is this something intentional? Or is this something that the customer is naturally pulling you towards? Is that a way to drive increased gross retention and stickiness in terms of the retention rates?

This has been very intentional. If you remember, the vast majority of our business that was termed was a single year, and that was kind of part of that land and expand, high-velocity frictionless motion. But as we got into larger enterprise, one, the process in a top-down strategic sourcing environment to renew is administratively more heavy. So it's -- we're incented to have customers engage with us over long periods of time. And what we also found was that customers want certainty. And it's, I think, harder than people might imagine to change a platform like ours out. We're deeply integrated in some cases, all the way through to run time. And they don't want to be surprised by either our product road map or pricing, et cetera. And so when we started the process of really encouraging our go-to-market organization and our renewals organization to work towards multiyear agreements, what we found was our customers were highly engaged and very well aligned in that regard. So it has been a concerted effort that we measure. And we have a significant portion now of our term contracts that are multiyear. And that's something we're going to continue to focus on. The number one -- the first principle there, too, is long-term relationships are more profitable, and they tend to be more valuable on both sides.

And I would just add to that, not only does the signal a strategic relationship from our perspective for the customer, it also signals the strategic relationship. So we've seen -- since we started with this initiative going back 2 years, we've seen an increase each quarter in terms of the number of contracts that are covered from a multiyear perspective.

Moving next to Kingsley Crane, Kingsley from CF.

I hope my video isn't spotty, but I want to touch on PagerDuty Advance. When I think about the naming of Agentic SRE and Agentic operations analyst, and it begs the question, do you feel like these capabilities are compelling enough to demonstrate replacement of an analyst at the customer level? Just kind of curious if that's how they're being positioned and then how to think about customer ROI and how that flows into pricing?

Yes. They're really being positioned as being complementary to human responders. And I think what's important is a lot of incident response is working through complexity and trying to understand dependencies to identify contributing factors to a failure. It's very rarely straightforward and very rarely are major incidents isolated to a single team. And so you have these kind of unique data issues or problem-solving issues where a single responder doesn't have visibility to what's going on across teams. But an Agentic responder leveraging a foundational data model could get to at least get pointed in the right direction faster and start to make suggestions, recommendations, take down what I would call simpler tasks first but also support the process of complex problem solving. So we see these things being complementary as opposed to more of a replacement orientation. And at the same time, we see customers looking to reduce the blast radius of major incidents, meaning how long an incident runs, the impact that an incident has across their customer base or their risk profile, whether it's compliance, for instance, or issues around customer trust. And so anything that you can do to help teams resolve a problem faster, but also learn from it and prevent it from happening again is important, and that's something that we've done by including Jeli's feature set inside of our incident management solution. So today, we see it as complementary. But certainly, there are going to be tasks that a number of responders right now have to undertake that are repeatable, meanial, lower value that these agents can pick up. That I don't think will reduce the need for talented engineers to be part of these major incidents when they happen because they do require -- a lot of these solutions require high judgment.

Yes. That's really interesting. And then second one, you talked last quarter about incentivizing some customers initially with some free credits to use Gen AI. You had some good response there. Just kind of curious if that initiative continued in Q4 and what kind of response you saw?

Howard i'll let you take that one.

Yes, sure. So Kingsley, what we've done is that in terms of some of the most recent packaging announcements that we've made, in fact, just last month in February. That, in fact, was a change in our lineup to be able to provide all paid customers with access to the Operations Cloud, and that included elements, of course, of PD Advance. So all customers end up with like a certain amount of usage that they get before they would then convert to paying for incremental use. So -- and we believe that's a strong model for allowing customers to be able to understand the value that they're going to get within their own environment with their context and can see what it will surface for them. And that's leading to really good discussions and, in fact, expansion on deals as a result of them having that access.

Moving next to JPMorgan, we have Pinjalim Bora joining us.

Jennifer, I want to ask you a little bit on the sales execution you had highlighted or talked about in the prepared remarks a couple of times. Could you maybe elaborate exactly what execution issues have you kind of faced? And what are you doing as you step into the new year, specifically to fix those issues? And then, Howard, maybe talk about just the bookings cadence that you have seen. And I'm trying to think about the assumptions around the guidance. And are you baking in a little bit of a caution, given what we have seen over the last 2 weeks on macro?

Sure. So I'll start. From a sales execution perspective, what we've talked about is, one, having to adapt to a change in the way our customers buy. So historically, we were able to grow in enterprise meaningfully with that land and expand high velocity motion, really targeting the technical user, the technical buyer within the organization. When the market shifted and customers really started to centralize authority to buy and force vendors into more of a procurement-led sale, we just shift the way we engage. At the same time, we were going through a transition from being a technical product sale to developers to a multiproduct platform sale to economic buyers. And what we learned when the land and expand motion didn't meet the requirements of our customers' buying behavior was that we needed to change the profile of rep to be successful. And we found that when we've done that, when we've hired a rep who has the background of selling multiproduct platforms top-down through more of a traditional technology leaders organization, they're more successful in selling the Operations Cloud in driving a multiyear 6- or 7-figure agreement. And so we've been going through that talent rotation. And we've also found that the more experienced the rep is in that sort of top-down selling motion, the more likely they are to ramp faster than previous cohorts. So that's one part of it. I think the second part of it is when you're not selling high in the organization and you can rely on the DevOps community almost in a singular way, you don't really have visibility to what else is going on inside of a large organization. And by engaging more closely and building account management that is multithreaded across personas that really helps us understand what's going on in the entire picture for the CIO or CTO, we've been able to better match to their budgeted initiatives. And again, when we do that, our success rates are higher. And so that's a big part of what we're doing. It is more about transforming to a true platform sales motion, even simple things like attaching services and making sure that customers are deployed effectively because even though our platform is relatively simple to deploy compared to large legacy platforms, these organizations that we're deploying into themselves are complex. And they sometimes need more support in doing that. But in the land and expand frictionless motion, you're not selling a lot of services. So it's just -- it's really more the evolution of how the market moved, how we need to move as a result of that. And our -- be having the opportunity to monetize a multiproduct platform to sustainably capture value at the same time that the market requires a different vendor support model, I guess, is a good way to put it.

Yes. And I think just to add on to Jen's comments because as a CFO, I want to make sure that we're not doing this at a rate that's going to be too expensive. So we're committed to improving our sales and marketing efficiency even to the extent that as we entered this year, we made some changes to reduce our run rate so that we could, in fact, continue our evolution into this full enterprise sales motion, but really by optimizing the existing spend that we had. So this hasn't been like it's not an additive expense that we're going through, but rather it's the case that we've been reconfiguring the resources that we have to be able to deliver this alignment with how our customers are buying. And then I think, Pinjalim to your question, how to think about bookings through the year. We've taken a view on bookings that anticipates a number of things taking place. One is based on the success that we've already seen with our larger customers, we want to build on that success with our larger customers. So we've seen, if you like, the enterprise health indicators such as the one I mentioned around customers above $100,000 growing at a faster rate than the customers that we have below that. So we will continue our efforts in that space. And our sales team is really focused on enterprise customers and being able to grow that base. And we have a significant percentage of reps who we hired within the back half of last year, who will be ramping through the first 2 quarters, and we expect to see them contributing to our overall growth in ARR, particularly in the back half of the year. Along with that, in terms of our commercial motion, we've taken another look at how can we take advantage of some of the recovery we've seen in the commercial, the SMB space in particular. And so we have a renewed digital-first experience that we're delivering there. We've had packaging that now makes a lot of the products accessible even to customers who are in that SMB space so that they can get broader use of the platform at a reasonable price. So we anticipate being able to use the -- that motion to, in fact, also contribute to our growth, and that will ramp through the year as well.

Just to be clear, for the guidance that you provided, are you assuming a similar macro than what you have seen? Or are you using...

We've taken what I would call like a prudent view. Obviously, you can never anticipate everything. And even within the current environment, we've tried to sort of model impacts and try and understand how things could play out. They're not always very clear for software and technology, as you would know, in terms of how that will play out. So -- but we have tried to indeed factor in a view that the only -- there are some things that we can control, and our focus is on what can we control and how can we drive performance through those elements.

And next, we'll hear from Nick Altmann with Scotiabank. Nick.

Awesome. I wanted to go back to Sanjit's question around 30% of ARR exiting the year being outside of Incident Management. When we think about the ARR sort of framework or the color you provided, and we look at the 2025 ARR mix, I think it implies like a little bit over 60% of the net new ARR in the year was from outside of incident management. And so when you think about this year's guide and kind of what you're baking in for net new ARR, how should the mix look in 2026 versus this year? Maybe kind of unpack the assumptions around incident management versus non-incident management as it pertains to net new ARR.

And before Howard jumps in on guidance, I just want to make a clarifying point. One of the areas that we see driving growth from a customer perspective is the customer applying PagerDuty's kind of traditional incident management solution to new, call it, horizontal use cases. And probably the best example is the AI-centric operations that they now are trying to manage. They're managing RAG models, LLMs, their own agents, their own AI-driven apps. And what you're seeing through that is a ton of increased complexity. And so that, for instance, is an example of you might still use our core Incident Management solution, but it's going to drive net new usage because it's a different use case than a traditional use case. The same thing is true for security operations, right? We have a lot of security teams that leverage our products and services for something that will be considered outside of the core of technology-generated incident management. And as we adopt more of a blended consumption and seed-based or platform usage model, we'll start to get some of the benefit of the value that we create through those new horizontal use cases. And so I just want to be clear that just because incident management is core and we're selling new products and services on top of it, we also still have the opportunity to grow incident management through applying that same technology to different problems across the organization. So sorry, Howard, go ahead.

Yes. Well, you started with exactly what I was going to say around the use cases. So yes, I think that's an important part, Nick, because as we thought about this in terms of the sales team's area of focus, certainly being able to drive those new use cases that utilize our full operations management approach, which includes incident management is going to be key. If we just look back over the last couple of quarters, we've consistently seen more than 40% of the incremental ARR in the quarter coming from our AIOps automation and customer service ops offerings. So when we looked into this next year, we're expecting that, that trend will continue, that it will still continue to be a strong contributor to the incremental piece. And as we factor in newer offerings like PD Advanced, which is small today, that will start taking -- will become an additive share to that piece outside of Incident Management. And as we move into monetizing Agentic AI, that will, again, will probably add a mix into what would be incident management today.

Okay. No, that's super helpful. And then just a clarification question. I appreciate the color on ARR this year. If we look at the net new ARR seasonality for 2025 versus 2024 is a little bit different. Obviously, there's some of the go-to-market stuff you mentioned. Macro is still a little bit cautious. But anything else we should be keeping in mind as we look at sort of the net new ARR seasonality for 2026 and maybe call out if there's any anomalies, deal slippage, et cetera, that maybe skewed the seasonality in 2025?

Yes, sure. So we would expect the seasonality to follow the pattern. This last year, it was kind of roughly equal each quarter. My expectation is that it will probably ramp gradually through the year as we move through the end of the year, given some of the changes that we've made in terms of the sales team. So that will mean that we'll start to see that increase gradually through the year.

[Operator Instructions] We do have another from Jeffrey Van Rhee at Craig-Hallum. Jeff?

Sorry about the light. You're catching sunset just perfectly behind me here. So be it. Just a few for you. Maybe, Howard, just on the pipeline. I think you commented last quarter that the pipeline was up 50% year-over-year. Just any update on the state of the pipeline here?

Yes. So we've entered this year with strong pipeline because I factored in the pipeline for the full year against the full year guidance range that we have provided. The Q1 pipeline that we started the quarter with was higher than what we had the year before. We've got the team to focus a lot more on quality of pipeline and how do we improve pipeline velocity so that you don't see this pattern of deals moving just from one quarter to the next. So certainly, we're in a good place. But my perspective, of course, is that sales teams need to keep on building pipeline, marketing teams need to keep on contributing to that pipeline. And hence, our focus even in bringing some of our events like PD On Tour or PagerDuty On Tour to earlier in the year so that we can actually leverage some of that earlier creation of pipeline in the year to benefit this fiscal.

Yes. Is the -- Jen, is the intensified focus on all the sales change I guess 2 questions. More a result of your dissatisfaction with the lead gen side or with the close rates and the way you're managing cycles as they go through. And then maybe just kind of along the lines of that question, it's just kind of a soft observation, but it seems last year, midyear, you were a little more satisfied with the execution in terms of how you're addressing the move to selling to procurement and the CFO type sale. And it seems now there's more less -- there's less satisfaction. So maybe just kind of take those 2 on, if you would.

I'm never satisfied. There's always an opportunity for us to continue to improve our execution. What I would say, if you look at our cohort over $100,000 and our cohort spending more than $1 million, like those are examples of where we're executing very well, where we're delivering higher retention rates. We're delivering higher growth rates. We're building more strategic relationships. They're multiproduct platform, multiyear relationships. And what I want to see is us scale that across the entire installed base in an accelerated way and in a very efficient way. And what we found is it works when we have the right profile of reps. It works when we're driving the right level of rigor and inspection around account engagement, around pipeline quality and pipeline conversion. And we just really got to standardize that across the broader sales assist organization. We can't execute well in pockets, right? So that is part of it. I'm really proud of the effort that our go-to-market organization undertakes because this isn't an easy transition. We operated one way really successfully for a long time. I mean most people would have said our flywheel and the land and expand motion was a strength, and it's still a strength in our lower -- down market in SMB and VSP, where we can manage that almost in an automated way from a digital perspective. But as our customers see us as a more strategic vendor, we have to be consistent in the way we engage and the way we build networks across multiple personas and the way we deliver and deploy our products and services and in the way we ensure our customers know they realized value. I think there are going to continue to be opportunities for us to evolve our pricing to better align our pricing with the value we actually demonstrate and deliver for our customers, and that's something that we're working on. But as we've improved, as I mentioned, the rep profile and brought in leaders who are experienced in an enterprise platform kind of top-down motion, we're seeing really promising results. So it's about scaling that. And it's about doing it with a lot of efficiency and an eye on productivity. And that's what we're going to be laser-focused on.

Yes. Yes. Understood. And congrats on the efficiency. I mean the profitability improvements in the free cash flow for the year, real nice improvement prior year. Just one last, if I could. Howard, on the -- I guess, on the SMB commercial side, just -- I want to make sure I heard you right. Is that viewed to be a growth engine -- not an engine, but it will grow in this fiscal year. Is that the assumption?

That is the assumption. If you recall, Jeff, we went through a period where we've seen negative growth year-over-year in that segment like for 4 consecutive quarters. And we've started to see like modest recovery in that space, and we expect that to continue. It's not going to be the major contributor to our growth this next year. Clearly, enterprise is where we're focused. But we did think there was an opportunity to revisit how we were managing that segment to try and get more out of that segment, particularly since a lot of that segment for us is tech start-ups. And with the AI enthusiasm, there were a lot of AI start-ups who are starting to become customers of us in that segment. And we will grow to be larger customers and hopefully enterprise customers one day, too.

Thank you, all of our panelists for joining and Howard and Jennifer will wrap up here. And Jen turning over to you for any final remarks.

Thanks, Josh. Well, thank you all once again for joining us today. Our strategic focus on innovation with our strengthening leadership team and enhanced go-to-market motion positions us well for future growth. Our momentum of our tenured enterprise field reps demonstrates the compelling value of our platform, particularly in our large and strategic enterprise customers. We remain committed to executing our strategy while building on the strong foundation of customer success, employee dedication and partner collaboration and doing it effectively and efficiently. I sincerely appreciate your continued engagement as we advance our mission to revolutionize digital operations. Thank you, and have a great day.