Informatica Inc Q1 2023 Earnings Call Transcript

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

Question: Matthew George Hedberg - RBC Capital Markets, Research Division - Analyst : Echo the success on cloud, it's great to see. I guess a question -- one of the topics that we hear a lot from is cloud cost optimization. And I'm curious, how do your customers think about that? And how does Informatica really play into perhaps that trend?

Question: Matthew George Hedberg - RBC Capital Markets, Research Division - Analyst : Got it. That's helpful. And then maybe just a quick one on it. You guys have been talking about AI and CLAIRE for a long time now. Is there a degenerative AI angle to Informatica's kind of AI strategy going forward as well?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Congrats on the quarter. I want to go back to the bookings trends. Seems like you're seeing consistent bookings trends in Q1. Help us understand how does the environment look to you through May now. Have you seen any change after kind of the financial sector turmoil at all?

Question: Pinjalim Bora - JPMorgan Chase & Co, Research Division - Analyst : Okay. Understood. And on IPUs, I believe Q1 marked a big cohort of renewal for IPU-based customers. Maybe help us understand how did you end up executing that, how well the renewal rates? And more specifically, we have been hearing that IPU has dramatically reduced the friction of using the platform. Is there a difference in characteristics with respect to expansion rates on IPU-based customers alone versus overall cloud retention rate?

Question: Patrick Edwin Ronald Colville - Scotiabank Global Banking and Markets, Research Division - Analyst : Can I just circle back to the IPU question earlier? Because I think the consumption model is most of us on the sell side and most investors in the buy side [knows better] the likes of kind of a Snowflake and others. I think what you are articulating earlier is that the Informatica consumption model is slightly different. You pay a commit, and you have different allowances. So would you mind just talking through, I guess, the similarities and differences? And then also in terms of accounting and when do you record revenue? Do you record revenue when the consumption happens or when the deal is signed?

Question: Patrick Edwin Ronald Colville - Scotiabank Global Banking and Markets, Research Division - Analyst : That was a terrific answer. And I guess Victoria (inaudible) won't be happy with me asking a second question, but I'll sneak one in. If a customer doesn't consume for whatever reason, what happens then? Do you push the credits out? Or do you recognize the revenue?

Question: Joseph Price Hickey - UBS Investment Bank, Research Division - Analyst : I'll be quick on this. Kind of back to maybe Andrew's point at the top of the call on just customer count. I understand Q4 and Q1 might be apples to oranges. But maybe looking over a longer-term time horizon, I think you guys have now disclosed 5,500-plus customers, and I think that's down from 5,700 during the IPO and 5,600 in the 10-K. So just curious how we should think about that figure.

Question: Joseph Price Hickey - UBS Investment Bank, Research Division - Analyst : Got it. Got it. And then maybe one just quick follow-up. Might just be on vertical mix and exposure that you guys have to financial services. Any color there? I know -- and Pinjalim was asking earlier. You said you saw kind of no change in March and April time frame, but I'm curious if there are any figures you can throw out there that help us think about the exposure.