SentinelOne Inc Q3 2025 Earnings Call Transcript

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

Question: Brad Zelnick - Deutsche Bank - Analyst : Great. Thanks very much, and good to see the ARR momentum continue to build Tomer, over the last few months, you've been very clear that the benefits you're seeing from market disruption and many of the newer growth levers and execution improvements wouldn't all show up immediately in your financials. And the trend is clearly positive from what we can see in Q3 results. But what is it that you see in terms of pipeline and the visibility that you have ahead that gives you confidence in acceleration? And then for Barbara, how does that inform how you might be thinking about next year at this point? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 04, 2024 / 10:00PM, S.N - Q3 2025 SentinelOne Inc Earnings Call

Question: Brad Zelnick - Deutsche Bank - Analyst : Okay. Thanks for taking my questions.

Question: Gray Powell - BTIG - Analyst : Great. Thanks for taking the questions. And yeah, I echo Brad's comments, it's great to see the net new ARR get back into positive territory. Just in terms of seasonality, maybe I missed this, but what was it that actually drove the stronger quarter-over-quarter growth in Q3 this year that was different than prior years? And then, just like how should we think about the sustainability of whatever that driver was?

Question: Rob Owens - Piper Sandler Companies - Analyst : Great. Thank you for taking my question. Curious about what you're seeing up market and the success with larger customers and larger deals, just from, I guess, a macro perspective, number one? And then the motion is you're selling, the multiple elements of the platform and where you're seeing the most success there? Thanks.

Question: Saket Kalia - Barclays - Analyst : Okay. Great, guys. Thanks for taking my questions here. Barbara, maybe just to start with you. Tomer talked about broadening the market presence with the Lenovo partnership. And it sounds really interesting. Maybe the question is, how do you think about Lenovo contributing to net new ARR? Specifically, when does that sort of kick in? And is this going to be something that ebbs and flows with Lenovo shipments sort of on a quarterly basis? Or talk to us about sort of how that layers into the model going forward? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 04, 2024 / 10:00PM, S.N - Q3 2025 SentinelOne Inc Earnings Call

Question: Shaul Eyal - TD Cowen - Analyst : Thank you. Hi. Good afternoon. Tomer, Barbara, so I know you slightly raised your annual guidance. I know you guys do not guide or discuss RPO metrics. It was up, I believe, 24% year over year, which I think would imply maybe a deceleration from last year and think just a 4% sequential growth. Can you talk to us about RPO trends maybe your thoughts on pricing and contract duration? Thank you.

Question: Tal Liani - BofA Global Research - Analyst : Yes, hi. How important is vendor financing in the market now? I'm asking it because we've seen Palo Alto doing it very aggressively. Now, we're seeing CrowdStrike starting it. Is this something that is required, or do you see higher requirement by customers? And the second question is just clarification. You noted a few times that you expect a strong net new ARR for 4Q. Is there any number that you have in mind or any growth you have in mind for a net new ARR for 4Q?Thanks.

Question: Tal Liani - BofA Global Research - Analyst : Thank you.

Question: Brian Essex - JPMorgan - Analyst : Hi, good afternoon, and thank you for taking the question, and great to see the reacceleration on ARR. I have two questions. I guess first one for Tomer. You've talked previously about a focus on new logo adds over expansion within the installed base. But maybe if you could help us understand where are you keeping your foot off the gas, so to speak, with regard to investing in expansion within the installed base where there's cross-sell upsell and how you think about prioritization or what you're holding back on as you invest in new logo growth? And maybe the follow-up for Barbara, with regard to just the one-time legal settlement costs in the non-GAAP financials, maybe expand on that a little bit, help us understand what they're for? And maybe why those point back to non-GAAP? Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 04, 2024 / 10:00PM, S.N - Q3 2025 SentinelOne Inc Earnings Call

Question: Joe Gallo - Jefferies - Analyst : Hey, guys, thanks for the question. Barbara, I know you're not giving guidance for next year yet, but can you just walk us through any changes to process you brought to SentinelOne or just your guidance methodology as a whole as we start to fine-tune our models for next year? And then as a part of that, Tomer, how are customers thinking about their calendar '25 budgets? Thanks.

Question: Matt Dezort - Needham & Company Inc. - Analyst : Thanks for taking the question, and congrats on the results. Tomer, for you, I think you talked about more enterprise displacements than ever in the past this quarter. Can you talk about whether pipeline supports continued momentum there, maybe how pricing and discounting are behaving specifically in those conversations? And then on the flip side of that, how are you seeing your ability to win change, if at all, since July 19 in the 50% of the market that is still leveraging legacy AV? Thanks.

Question: Shrenik Kothari - Robert W. Baird & Co. Incorporated - Analyst : Great. Thanks for taking my question. Again, great execution on the net new ARR. Tomer, well as Barbara, mentioned ARR per customer, of course, hit a new high this quarter driven, of course, by success in large enterprise and highlighted cross-sell upsell. Could you help unpack how perhaps macro factors like the constrained IT budgets and also the outage dynamic that influences sales in size? Is there a dynamic of potentially larger deals affecting cycles getting a bit longer? Then I have a quick follow-up here.

Question: John DiFucci - Guggenheim Securities LLC - Analyst : Thank you for some color on that point. Tomer, on that point, it does take time, right? There's sales cycles and especially for the enterprise. But for the SMB and the mid-market, you talked a lot about the enterprise, those sales cycles are a lot shorter. Now, the results this quarter indicate improving momentum for the business. Obviously, there's some investors, I guess, might have expected a little more, but it does indicate that. Can you comment on how the SMB/mid-market performed this quarter?

Question: Trevor Walsh - JMP Securities - Analyst : Great. Hi, team. Thanks for taking my questions. Maybe, Tomer, just following up a little bit on the MSSP portion of your comments that you made just a second ago. In the shareholder letter, you talked about kind of expanding the potential of products within the MSSP specifically around CNAPP. Is there a reason or kind of can you help us understand maybe a little bit more detail as to kind of why it's a more gradual release of products within that space? If it's more just not wanting those partners to get to over their skis in terms of the technical requirements and enablement or some other kind of limiting factor and why not just, I guess, let them go kind of more just broadly all at once on the platform? Just help us kind of understand those dynamics, that would be great. Thanks.