Tenable Holdings Inc at UBS Global Technology and AI Conference Transcript

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

Question: Roger Boyd - UBS AG - Analyst : Awesome. But I wanted to start high level and go back to a comment that Steve made on the earnings call last month. But he called out that the AI threat landscape is exposing the limits of a traditional reactive approach to security. Can you just explain what that view means, this idea of more fireproofing versus firefighting? And how does that align with what you've built in the exposure management category?

Question: Roger Boyd - UBS AG - Analyst : Yeah. I guess maybe to follow up there, how do you feel this evolves as a demand environment? And I look at 3Q results, fairly strong. Do you feel like we're starting to see this? Do you need additional lever to come from like regulatory angle? Like the pessimistic view would be, we need to see something happen in the threat environment that forces enterprise's hands. Like how do you see this evolving from a budget perspective?

Question: Roger Boyd - UBS AG - Analyst : Cool. Yeah, I want to dive a little bit into 3Q, and again, a fairly strong quarter. The net adds continue to stand out. You added almost 450 new enterprise customers. I wanted to dig a little bit deeper into what drove -- what was driving some of the momentum on a customer adds perspective? And how are you thinking about sustainability of that going forward?

Question: Roger Boyd - UBS AG - Analyst : Yeah. When you talk about the strength of Tenable One, how do you think about new logos from a greenfield, brownfield perspective? And I know all of your competitors have been moving towards this vision of exposure management; for you, it's Tenable One. Competitively, have you seen any big shifts in the landscape? And what have you seen specifically on kind of the brownfield side of new logos?

Question: Roger Boyd - UBS AG - Analyst : Makes sense. And then the other side of the growth formula, net retention, it's been somewhat stable in kind of the single digits, 105%, 106%, 107% range. I recognize it's a trailing 12-month metric. But how do you think about the trajectory there? And given the strength you've seen in Tenable One, 40% of new business last quarter, what's the pathway to getting that to reaccelerate here?

Question: Roger Boyd - UBS AG - Analyst : That's a good segue. I think that number is close to 17% today in the high teens. Is there a target you think about internally about how far Tenable One can go in the installed base?

Question: Roger Boyd - UBS AG - Analyst : Yes. Okay. The other impact I think we've seen is customers making bigger commitments to Tenable. And I'm sure part of that is around Tenable One. I think last quarter, you mentioned the discrepancy between CCB and RPO and certainly, I think, seeing longer deals show up. Can you elaborate on that dynamic? And as you see more of these big commitments, what does that mean for some of those metrics?

Question: Roger Boyd - UBS AG - Analyst : Okay. Makes sense. I wanted to talk a little bit about cloud security. And I think there's an investor perception out there that that's been a difficult competitive environment. We've obviously seen some transactions in that space. To what degree have you seen that change the environment for those deals? I know you called it out as an area of strength with Tenable One. And what momentum have you seen with specific deals around cloud security? LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 02, 2025 / 9:55PM, TENB.OQ - Tenable Holdings Inc at UBS Global Technology and AI Conference

Question: Roger Boyd - UBS AG - Analyst : Yes. Similar question around AI security and Apex. And I'd be curious to get your perspective. I mean, in some ways, it feels like the first-place enterprises are going to turn to trying to enforce AI security is going to be around risk assessment and posture management and just getting visibility into what they have. That should set you guys up in a pretty good spot. But how do you think about that demand showing up over time? And how do you think about your right to win? We've seen a lot of companies in the space acquire into like the AI visibility, AI posture management space. What gives Tenable the right to win with this broader Tenable One posture?

Question: Roger Boyd - UBS AG - Analyst : I want to talk about a couple of verticals here, but the first being US federal. And I think 3Q, you had performed pretty well against expectations that had come down a little bit earlier in the year around some of the uncertainty there. What's been the mood within those customers? And when you think about timing around the Fed shutdown we saw in early 4Q, to what degree did that influence 3Q? And how are you thinking about kind of that opportunity going forward?

Question: Roger Boyd - UBS AG - Analyst : Cool. Okay. And then the other vertical is -- it sounds like it doesn't get as much attention as cloud or AI, but the OT space was called out last quarter as an area of an acceleration. And I think there's something to be said about the convergence of IT and OT and CISOs being more involved in those conversations. I know Steve called out the data center market around AI as a potential interesting opportunity. How do you feel about that vertical? And what -- can you frame that opportunity going forward? And what's the differentiation there between some of the specialists in the space?

Question: Roger Boyd - UBS AG - Analyst : I want to touch on margins a little bit. 3Q is, I think, a pretty good EPS beat, 23% operating margin. Free cash flow is continuing to look nice despite what you called out around on the billing side. Just maybe talk about kind of your visibility there. And then just broadly, how you're thinking about kind of the trade-off of continued margin expansion versus trying to invest in a lot of these pretty fast growth areas across cloud and AI and OT. LSEG STREETEVENTS | www.lseg.com | Contact Us consent of LSEG. 'LSEG' and the LSEG logo are registered trademarks of LSEG and its affiliated companies. DECEMBER 02, 2025 / 9:55PM, TENB.OQ - Tenable Holdings Inc at UBS Global Technology and AI Conference

Question: Roger Boyd - UBS AG - Analyst : Maybe to double-click on the sales and marketing efficiency aspect of that, are there -- is there more room there to eke out efficiency? Is it like you look out into next year and like there's a desire to grow headcount and improve capacity? Like how do you think about that?

Question: Roger Boyd - UBS AG - Analyst : Yeah. Makes sense. And then maybe -- you mentioned R&D and product. Maybe talk about kind of the principles behind that. I mean, you have all these different growth areas. How do you think about dividing your R&D resources? And where does continued M&A fit into that category? You've been fairly acquisitive over the past couple of years, tucking pieces into the platform. Are you at a point now where you feel like there's enough breadth of Tenable One? Or are there potential future areas where you can continue to expand?

Question: Roger Boyd - UBS AG - Analyst : Yeah. Maybe two last ones. Just any broad-level thoughts about the demand environment? I think there's -- on one side of the page, a pretty healthy view that concerns around the AI threat landscape are going to continue to fund cybersecurity budgets. But you also hear about budget tightness and procurement still being difficult. How do you think about kind of customer budget, security budgets into 2026 at a high level?

Question: Roger Boyd - UBS AG - Analyst : Yes. Cool. Last question for you, Matt, because you're relatively new to the story, what was one thing that attracted you to Tenable? And now being in the seat for a little bit, what's one thing that surprised you?

Question: Roger Boyd - UBS AG - Analyst : Cool. Well, thank you for joining for a great conversation. And thank you all for listening in.