Jfrog Ltd 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 : Yes. Thank you for explaining that. That helps. I get a lot of questions on what is binaries to start off with. But your core product is Artifactory repository or in other words of saying repository for those binaries, right? Help us understand what is kind of the alternative to it, right? Because software development has existed for several decades now. What is the alternative to using Artifactory repository? And what has -- is there -- has DevOps being a capitalist for people to choose a platform, something like a JFrog?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : So the value proposition is you're removing the need to manage a lot of different repositories. You're removing a lot of people that would need to manage those different repositories. 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 23, 2023 / 9:15PM, FROG.OQ - Jfrog Ltd at JPMorgan Global Technology, Media and Communications Conference

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : So clearly, you have a kind of a critical position in the DevOps life cycle, right? We think you're saying system of records for binaries, there's a system of records for source code, which is the gate repository, let's say. But when we look at Artifactory, we don't really see much competition, right? You have Sonatype nexus, but other than that, that's also pretty small. There is not much competition. Why is that? What is so difficult in creating this repository?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : So let's talk about this critical position and how that helps you on the security side, right? Is there an inherent advantage to control that system of record for binaries that gives you an advantage to secure those binaries?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes, interesting. So you entered the security space with Xray initially. And now you have launched the advanced security, which is further leaning you into the security space. Maybe talk about that difference, right? What does Xray provides and what does advanced security provide?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. Before we go further, is there a way to understand kind of the mix of the business between your binary repository and security?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Within that DevOps, what's the extra mix? It's like 25% is like a good guess?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : No, that's great. So now on advanced security, that seems like an interesting product that's coming out. It's a product cycle. You launched it in cloud initially late last year. You said you launched in on-premise or self-managed recently. First of all, what is the applicability of advanced security across your customer base? Would you say it's applicable to 100%, 50%? How should we think about that? And so -- and the other part is you're basically saying that it will be a tailwind in 2024. Is that correct? 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 23, 2023 / 9:15PM, FROG.OQ - Jfrog Ltd at JPMorgan Global Technology, Media and Communications Conference

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. Okay. Got it. I want to switch gears a little bit and maybe talk about macro. That has been a consistent theme across software nowadays. You kind of saw a little bit of a better cloud consumption trend. It seems like in Q1.

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Q1 results were really good. How would you kind of characterize macro or the cloud consumption trends going into May at this point when you're talking to customers?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. Yes. Understood. Okay. One common topic again is, obviously, this 2-letter word called AI. It is kind of taking software development by storm, starting with CoPilot. We're hearing more and more quotes for ServiceNow has its own LLM nowadays. We're hearing more and more of this, right, and there's no doubt. For everybody, I think, are thinking that, okay, this will increase productivity for software developers, which likely means they will develop more software as well. 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 23, 2023 / 9:15PM, FROG.OQ - Jfrog Ltd at JPMorgan Global Technology, Media and Communications Conference The pace of software development will increase. How do you see kind of GenAI? Is that -- is it right to think it could be a big tailwind for JFrog as that pace of software development increases, pace of binary increases, you need more usage of JFrog?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Yes. Understood. Again, switching gears. You recently talked about a long-term model, which was very interesting to see in Q1. And it's an ambitious model. I think you're talking about a 23% CAGR over a 5-year period. I'm curious why now? Like why now the timing the macro environment is still uncertain. We don't really know. What are you kind of embedding some of the assumptions as you build that multiyear model?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Is that -- does that also include any kind of new products as you're thinking through that 5 years?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Understood. That was a great plug on IoT. Yes. Any questions out there? Unidentified Analyst Within security, who do you see as the competitors you're looking to either displace or...

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Can you remind the group what percentage of your -- like how many salespeople do you currently have? And how do you think about sales in the next 12 months?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Okay. I guess we're out of time here.

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Thank you so much for your time.