GitLab Inc at Morgan Stanley Technology, Media & Telecom Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Sanjit Singh - Morgan Stanley - Analyst : I thought we spent the beginning conversation just introducing yourself, Bill. You and I worked together while we're at New Relic. Maybe if you could just, as the newly appointed CEO, for the in the audience who are unfamiliar with your background, can you give us a sense of your sort of clear highlights? And what was the sort of reasons why you took on the CEO role at GitLab?

Question: Sanjit Singh - Morgan Stanley - Analyst : Yeah, you've had intimate experience with these end users and these customers throughout the course of your career. The point that you just made about creating -- GitLab has created a sort of a distinctive culture. I think that was one of Sid's hallmarks creating the most distinctive and transparent cultures in all public company software. How do you anticipate the clear lending curve will be for you over the next year as you look at the business, what do you think is going well? Where do you think changes need to be made as you look to grow faster and sharpen the execution?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. Brian, Bill just talked about the growth rates that you GitLab have been posting. You guys grew, I think, a little over 30% for the year. There's not that many companies in software growing at that rate. In Q4, you grew 29%. You guided next year if you sort of squint about 24%. Can you talk to us about the themes coming -- exiting the year in Q4 from a business perspective. And what are sort of the key underlying assumptions that frames out that 24% guidance for next year?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. When we think about that bucket of new opportunities, Duo pro and Enterprise, GitLab, Dedicated, ultimately GitLab workflows will come on line, we have the [agile line] product that gained some momentum. And as we look at that as a category, when do you think, Brian, that starts to meaningfully impact the results maybe through the lens of NRR, maybe NRR is not the right lens and a tick down about a point this quarter. As we look into next year, when does that class of new products really have the scale and have to drive overall growth?

Question: Sanjit Singh - Morgan Stanley - Analyst : Yeah. On the customer front, a lot of headliners there, including [info] and some of the others. Maybe a couple of follow-up questions before we get in to the meat of the opportunity. You mentioned on the call that public sector is about 12% of ARR. How did you elaborate any sort of Fed spending uncertainty into the fiscal-year '26 guidance?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. So maybe just talk about -- I kind of tagline in my notes, conviction in the opportunity. When we initiated overweight last year, broadly what we saw was a highly innovative company that's targeting a market that's been, frankly, best of breed, and we saw opportunities for that to consolidate while driving a lot more automation and ROI for your customers. The skeptics on the story kind of believe that the runway is actually a lot shorter that there may be headwinds on developer seat growth. There's a notion that maybe customers are already sort of self-selected into GitHub versus GitLab. From your perspective, why is that line of thinking on the size of the opportunity for GitLab. Why is that misplaced?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. Let's talk a little bit about the drivers of growth, maybe starting with Ultimate. Pretty interesting time on the Ultimate journey, just hit 50% of ARR. So Brian, to what extent has price increase on Premium nudge customers to come in fiscal year '25. And then ultimately, what do you think the Ultimate gets to?

Question: Sanjit Singh - Morgan Stanley - Analyst : Is there any detail you can provide us because I just got another question that we get is that it sounds like Ultimate is doing really, really well. I get a lot of questions on the Premium subscription tier, the sort of trend lines around [seed] growth. There's a migration impact that's happening directionally from Premium to Ultimate. But what's the -- maybe excluding the migration impact, how do you feel about the trend line to see expanding on Premium?

Question: Sanjit Singh - Morgan Stanley - Analyst : That's great context. Talking about the category a little bit. When we think about the software development life cycle, it's one of the best playgrounds, I'd argue for it, one of the top two or three best playgrounds for customers to prove out AI in their organization. So the innovation cycle is progressing rapidly in the category sort of in real time, making a transition from code assistance to agents. Do you think this focus on sort of innovation cycle in sort of changes the customer buying psychology, which I think, frankly, for the last 18 to 24 months has been around ROA, ROI consolidation

Question: Sanjit Singh - Morgan Stanley - Analyst : And talking about agents and what GitLab is doing on the agent front, here the offering there's GitLab Workflows, which you're currently in private beta. Can you describe what GitLab Workflow does in terms of unlocking value across the entire software development life cycle? And any sort of early customer feedback on that?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. Maybe a couple of follow-ups because that sounds very exciting. You think about like the timeline in terms of timeline to GA, any sort of color you can provide there. But more importantly, and I think we talked about this on the call back, when you think about the GitLab customer base, are you guys going to get sort of first shot at that at sort of their sort of a agentic journey, I mean they'll wait for GitLab Workflows before something from a private starter comes up and tries to pitch them on. What sort does your underlying assumptions around how the customer base is going to anticipate and perceive GitLab Workflows?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. Let's take what you just said back. I was just going to say to the question about why GitLab customers should use GitLab first. This would be a great opportunity for you to talk about the knowledge graph in context to actually help solve that.

Question: Sanjit Singh - Morgan Stanley - Analyst : Yeah, that's a great point. Great color, Brian, let's take what you just said in terms of the priorities going to next year and the tweaks and refinements to strategy to the sales organization. So this week, you announced Ian Steward as your new Chief Revenue Officer will be starting over the next month. When you look at the changes that are going to be implemented across the go-to market and sales this year, what does that look like?

Question: Sanjit Singh - Morgan Stanley - Analyst : Awesome. And the last 25 or 30 seconds we have, if you look at where GitLab been approaching $1 billion nest growing at the upper decile of software, still trading at a discount to some of your peers going out at the same rate. What gets you most excited, Bill, about GitLab, the opportunity ahead from here? And from an investment perspective, why should investors get excited about the GitLab opportunity? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MARCH 05, 2025 / 9:50PM, GTLB.OQ - GitLab Inc at Morgan Stanley Technology, Media & Telecom Conference

Question: Sanjit Singh - Morgan Stanley - Analyst : You're going to be fired up. It's very exciting. We're out of time. Thank you, Bill and Brian, for giving us an update on the GitLab story. Thank you very much.