The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Arjun Rohit Bhatia - William Blair & Company L.L.C., Research Division - Analyst
: Perfect. And I will add my congrats on a great quarter. Bill, maybe I want to follow up on your conversation about inflation earlier. I'm sure you're
seeing hosting costs go up, labor costs are increasing. At the same time, right, with your product, you're adding more value to customers. You've
talked about ServiceNow being a deflationary platform and you're innovating. But how do you think about pricing in this environment for your
solution? Is there an opportunity to be more aggressive as you add more value and to try to maybe offset some of the costs that are increasing on
the OpEx side?
Question: Karl Emil Keirstead - UBS Investment Bank, Research Division - Analyst
: Gina, I just wanted to give you a chance to elaborate on the U-shape cRPO trajectory in 2022. And in particular, I just wanted to clarify the 1- to
2-point sequential headwind to that metric. So does that mean that the 28% guide in 2Q would be maybe 29%, 30% normalized. And then in 3Q,
do you get another 1- to 2-point headwind before you get that acceleration in 4Q? Love any color you can provide, as I think others on the call
would.
Question: Kasthuri Gopalan Rangan - Goldman Sachs Group, Inc., Research Division - Analyst
: Let me call my congratulations on a spectacular quarter. Bill, I think you've got the macro argument pretty well nailed. I'm not going to ask that
question, but I'm curious to get your thoughts as you scale the company to a 15-plus, I noticed the plus after 15. How do you think about distribution,
given that you've run big distribution of big companies before. The customer count of 7,000, 8,000 certainly is very impressive, big deal sizes. As
we envision the life beyond 15-plus, what is the go-to-market structure of the company look like? Are we looking at a 2-tier, 3-tier type distribution,
predominantly go-to-market, high-end, channel, SI, et cetera. Help us envision the future, Bill, to get to your target.
Question: Kasthuri Gopalan Rangan - Goldman Sachs Group, Inc., Research Division - Analyst
: I'm already there. Definitely seeing you there.
Question: Kasthuri Gopalan Rangan - Goldman Sachs Group, Inc., Research Division - Analyst
: I can. Absolutely.
Question: Matthew George Hedberg - RBC Capital Markets, Research Division - Analyst
: Bill, really as a follow-up to that last question. You mentioned of observability. You guys recently launched incident management platform. I think
it's really infused with Lightstep and observability. I'm wondering if you can talk about the importance of that offering? And maybe just double-click
again on sort of why you think you're going to win in observability, because it seems like a huge market opportunity for you guys.
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APRIL 27, 2022 / 9:00PM, NOW.N - Q1 2022 ServiceNow Inc Earnings Call
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