Informatica Inc at JPMorgan Global Technology, Media and Communications Conference Transcript

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

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : So maybe just give a brief intro about yourself and when did you join the company, how long have you been in the company?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. That's a great segue. So yes, Informatica, I used to cover it when it was public the first time around. It was a different Informatica at that time. A lot of things have changed. It went private. It actually built $1 billion business at that time period, right, went private, became public again. Help us understand kind of the evolution, right? What has -- what is the difference between today and what was?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : That's a good data point, ETL is less than 25%, because a lot of investors still think of Informatica as an ETL company. I appreciate that. I want to go back to one phrase that you used during the conference, Informatica, which was obviously a pretty fabulous conference. I really enjoyed that one, with a lot of good AI announcements there. You use this phrase called AI-powered digital transformation. Maybe elaborate on what did you mean by AI-powered? And do you think data transformation has to be kind of a precursor for that to happen?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes, I have tons of AI questions, so I'll get to that. But on the cloud product, the IDMC journey that you are in, you're kind of leaning in on cloud now from a sales and marketing perspective. Are you leaning in from an R&D perspective as well? And is it -- I don't know if it is even fair -- but to compare kind of the product parity versus the IDMC -- self-managed versus IDMC cloud today?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes, For sure. The -- so the other part of the cloud journey, I guess, is the flexible consumption model, right? And you have transitioned that business model from perpetual to term subscriptions now, this flexible consumption model based on IPUs. Maybe -- we actually talked to one of your customers who said it massively -- he used the word massively -- reduces the friction of using the cloud platform. Maybe bring that to life a little bit. How does it reduce friction? And maybe, Mike, I can bring you into this conversation, talk about a little bit on the rev rec side of things, how does that change the model or not?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes, that's very clear. I almost feel like I need an IPU-based model for my TV streaming platforms. But -- okay, let's go to AI. AI is a big topic right now. I want to ask you a 2-part question. One is, how do you think generative AI or AI in general kind of changes this data analytics, data management space? In general, not just talking about Informatica, because we have seen Tableau talk about AI in the BI space, I think there are companies like ThoughtWorks and some of the other ones. And then second part is, how do you think of AI within Informatica? Like help us think through kind of the long-term vision, not just talking about what you have today?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : So it sounds like it definitely lowers kind of the learning curve?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : The friction to start using kind of Informatica, from a user's [standpoint].

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : So Mike, does that potentially help on the net retention side over time? I'm not talking about next quarter. But over time, is that a kind of an upward bias?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : And have you disclosed any kind of monetization? How are you monetizing that CLAIRE Copilot, CLAIRE GPT? Or on the other side, the cost side, right, the gross margin side, is that as customers start typing in a lot of stuff, is that going to hit gross margin, maybe help us understand.

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Sounds good. That's clear. So coming back to another topic, which is macro, right? You had posted a really good Q1. I'm sure -- you had a conference recently, which was fabulous. You probably caught up with a lot of customers in the conference. What is your sense of kind of the macro environment at this point? How is the demand environment, the business confidence that you're seeing when you're talking to these customers?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. Yes. Understood. One question on migration, which we get a lot. Migration -- well, maintenance, [parse into] maintenance is about 1/3 of your business at this point. In the conference, you did talk about some newer kind of maintenance -- or, I should say, migration capabilities. How should we think about migration this year? Would you feel like some of these newer things that you're launching could actually accelerate the pace of migration this year?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. I have a few more questions, but I want to see if anybody else. Can we have a mic here, please? Unidentified Analyst It's a question for Amit. Actually, it may be a little left [for you]. How do you see competition from Kafka or the streaming data Confluent and so on?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Mike, I want to ask you one question on total ARR in the last 1 minute we have got. It seems like cloud on 35% growth will probably end up being the largest part of your 3 lines, right, subscription, maintenance and cloud. As you kind of get out of 2023, do you feel like you're taking a step down in growth in total ARR in the net new that you're adding. Do you feel like it's the trough to 2023, and we might see it stable or move up from here?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Awesome. That's a great note to end on. Thanks so much for the time, guys. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. MAY 22, 2023 / 1:20PM, INFA.N - Informatica Inc at JPMorgan Global Technology, Media and Communications Conference