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Thank you for standing by, and welcome to Netskope, Inc. Fourth Quarter and Full Year Fiscal 2026 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speakers' remarks, there will be a question-and-answer session. I would now like to hand the call over to Michelle Spolver, Chief Communications and Investor Relations Officer. You may begin.

Good afternoon, and thank you for joining us today. With me on the call are Netskope, Inc. CEO and Co-Founder Sanjay Beri and CFO, Andrew Del Matto. The press release announcing our financial results for the fourth quarter and full year fiscal 2026 was issued earlier today and is posted to our Investor Relations website at investors.netskope.com along with a supplemental presentation. Before we begin, let me remind everyone that some of the statements we make on today's call are forward-looking, including statements related to our guidance for the first quarter and full 2027 fiscal year, growth opportunities, competitive position, and the impact of AI adoption. These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated by these statements. Additionally, these statements apply only as of today, and we undertake no obligation to update them in the future. For a detailed description of risks and uncertainties, please refer to our SEC filings as well as our earnings press release. Finally, unless otherwise noted, all financial metrics we discuss on this call other than revenue will be on an adjusted non-GAAP basis. We have provided reconciliations of these non-GAAP financial measures against the most directly comparable GAAP financial measures in our earnings press release. Now let me turn the call over to Sanjay to discuss our business and high-level Q4 financial performance. Thanks, Michelle.

Welcome, everybody, and thank you for joining us to discuss Netskope, Inc.'s fourth quarter and fiscal year 2026 results. We ended the year on a high note with results that exceeded our guidance across all key metrics. Our focus on delivering a market-leading platform for networking, security, and analytics for the modern world of cloud and AI is resonating well with customers and driving both new and expansion business. Strong global execution resulted in robust fourth quarter results, highlighted by record net new ARR of $57 million and ending ARR of $811 million, representing true organic growth of 31% year over year. Revenue in Q4 grew 32% year over year to $196 million, and revenue for the full fiscal year 2026 also grew 32% to $709 million. We continue to leverage the investments we have made in our Netskope One platform and NewEdge Global Private Cloud network to drive efficient growth, which is reflected in the five percentage point improvement in operating margin in Q4 and an 18 percentage point improvement for the full fiscal year 2026. We are also very pleased to generate $12 million in free cash flow for fiscal year 2026, marking a notable milestone of Netskope, Inc.'s first ever year of positive free cash flow. We also saw a strong mix of both new logo growth and customer expansion across key verticals and geographies. The average number of products per customer increased to 4.4. Customers are solving key use cases through the adoption of our Netskope One platform of 25 security, networking, analytics, and AI products. This is reflected in our net retention rate of 116% and 22% growth in customers with over $100,000 in ARR year over year. Andrew will give more color on our Q4 and full year fiscal 2026 financials in a few minutes. We have had many innovations, go-to-market, and operational highlights during the quarter, and one theme that threaded prominently across all of these was AI. Netskope, Inc. is uniquely positioned as a significant beneficiary of the AI super cycle because we have engineered a unified AI-native fabric that eliminates the legacy trade-off between performance and security. We have organically built the Netskope One platform as the intelligent edge—an inherently adaptive architecture where our native AI fluency and active context are seamlessly integrated into our global infrastructure defined by its performance, resilience, and dynamic orchestration. I would like to spend some time today walking through the four pillars of our AI strategic framework, which demonstrate why Netskope, Inc. is the essential engine powering the scale of the modern AI enterprise. First, Netskope, Inc. is an AI-native platform with sovereignty and privacy by design. From day one, we were engineered as an AI-native platform. Our competitive moat is architectural, not a single bolt-on feature. Since our inception, we have leveraged and integrated AI as foundational across our platform. In the early days, we used shallow and deep learning, and today, we further augment these capabilities with generative AI models to deliver maximum impact for our customers. Every implementation follows our core principle of privacy by design. We believe intelligence should never come at the cost of data privacy or sovereignty, and we operate a library of more than 190 proprietary purpose-built, specialized AI models optimized for security and network performance. This quarter, we continued to enhance those models, and our AI labs released additional models that are used in our new AI security products. Unlike competitors using just generic LLMs, Netskope, Inc.'s intelligence is purpose-built, high speed, and hyper accurate. The second key pillar in our AI strategy is enabling and securing AI in real time. While legacy and first-generation SASE vendors perform so-called post-event autopsies with out-of-band scanners, Netskope, Inc. provides real-time, in-line AI security for corporate and shadow AI. We do not just see that an AI transaction is happening. We understand the data and intent within it and take real-time granular action. Let me explain. Most solutions simply see a connection. Netskope, Inc. understands the deep interaction. Because our proxy is natively AI fluent, we possess the active context to determine dynamically in real time the specific AI app instances, activities, data, and more. We also determine the semantic intent of prompts and responses in real time and enforce in-line policy. Our Netskope One Agentic Broker—one of a number of new AI products we announced earlier today—also seamlessly applies this to all MCP transactions, either sanctioned or unsanctioned. This is why at Netskope, Inc., we are not just observing and enabling the AI revolution. We are the engine generating the high-fidelity data that secures it. In today's world, the most valuable asset is not just the AI model. It is the unique real-time data and transaction telemetry that understands the intent and lineage behind every interaction. Netskope One generates a vast and proprietary set of AI-fluent metadata and data for trillions and trillions of transactions a month that traditional security tools simply cannot see or generate, decoding the complex language of AI agents, generative AI apps, AI tools, and cloud JSON in mid flight. But while the power of our unique data is a competitive moat, our purpose is singular—the dynamic protection of our customers and their nonhumans and humans. We leverage this unprecedented visibility to protect our customers, ensuring that they can innovate at the speed of AI without ever compromising the integrity or sovereignty of their most sensitive information. We apply in-line decisiveness—or put another way, we make granular go or no-go decisions in flight. This allows us to stop sensitive data from entering prompts and block poisoned AI responses or injection attacks before they ever reach a customer's environment, protecting users, apps, and autonomous agents alike. And our Netskope One AI Guardrails, also announced today, take this to the next level. These deep contextual controls are necessary for enterprises to move from prohibiting AI to enabling AI with confidence. We do not just see more. We protect better, turning our unique data into the ultimate foundation of trust for the agentic era. Our third AI strategy pillar centers around providing differentiated and unmatched performance and resilience through our NewEdge AI infrastructure. AI transactions are uniquely sensitive to latency. Legacy networks create a latency tax that breaks AI performance. Conversely, our NewEdge infrastructure—the world's largest, high-performance private security cloud—is the AI Fastpath. It is the most resilient, high-speed highway for AI transactions globally, including AI applications and agents hosted in public, private, and new clouds. It is also an agile edge. Our infrastructure is defined by performance, resilience, and dynamic orchestration. We process complex security at the edge, closest to the agent, app, or user, reducing lag for secure real-time inference while allowing the network to dynamically adapt to the high-velocity traffic patterns of the AI era. And lastly, our fourth AI strategy pillar is a platform built organically and natively for the agentic economy, with an AI-fluent proxy and for autonomous operations. The perimeter has shifted from being filled with people to entities. Netskope, Inc. uniquely addresses this with a platform that specifically speaks the language of AI. As we mentioned, our architecture and native AI-speaking proxy innately understand APIs and JSON. This AI-native visibility enables hyper-granular zero trust control over AI transactions that other vendors simply cannot see. Through our just announced Netskope AI Gateway, we extend this enforcement anywhere—public cloud, private data center, or the edge. We also just released our first autonomous Netskope AI agents, which have already been met with exceptional customer feedback. One of the areas our agents will address will be automating operations. These classes of agents from Netskope, Inc. automate complex network and security tasks, drastically reducing the human-in-the-loop requirements for global enterprises. Our recently released ZTNA AI agent has been received very well in this area. And finally, we offer universal governance. By marrying our market-leading data protection with our newly introduced Netskope AI Guardrails, we secure and moderate for acceptable use all communications, whether via Model Context Protocol (MCP) via our Agentic Broker, prompts, or ShadowAI, for humans and nonhumans alike. Because of these unique and highly differentiated four pillars of our AI strategic framework, many of the world's most sophisticated enterprises choose to secure, accelerate, and analyze their AI transactions through Netskope, Inc. As a result, Netskope, Inc. has become one of the most definitive sources of enterprise AI data usage and trends in the world. We were pleased to announce today the Netskope AI Index, which consists of a first-of-its-kind interactive view of real-time AI usage across the world—data covering virtually every country, industry vertical, and company size—providing a granular view of AI adoption and attributable intelligence that positions Netskope, Inc. as the authority that customers and the public can cite when describing the real-world trajectory of the AI economy. We have also kept our foot on the gas innovating across our Netskope One platform of security, networking, and analytics products, and in other related areas. Let me share a few recent examples. On the data security front, we strengthened our competitive edge with the introduction of Netskope One Data Lineage. Data Lineage enables security teams to track and visualize the movement of sensitive data across their entire organization through various levels of origin, usage, and access, including visibility into when that data propagates or evolves. We also introduced new capabilities and integrations to improve secure connections to enterprise applications from unmanaged or BYOD devices. Enterprise browser support was expanded to a new range of iOS and Android mobile devices, while deeper integration with our Remote Browser Isolation and Private Access solutions provides a range of highly secured deployment models to enable users to connect to private apps through web browsers on their unmanaged devices. And on the networking and infrastructure side, we delivered our DNS as a Service that enables customers to point their DNS traffic to Netskope, Inc. for resolution, which can then use our DNS content filtering and security to provide secure access for often overlooked and unprotected use cases like guest Wi-Fi access. Our continued innovation expands our robust Netskope One unified platform of 25 security, networking, analytics, and AI solutions, providing more opportunity to land and expand with customers. We are an organically built, truly integrated, modern platform for the AI and cloud era. I want to emphasize this point about platforms in the context of what we repeatedly hear from customers. They are telling us that while they desire truly unified platforms over a slew of point solutions, they also are not seeking a single platform for all their security and networking needs. The unification they desire in a platform is what Netskope, Inc. uniquely delivers. We built our AI-native Netskope One organically, not through M&A, which results in a disjointed, cobbled-together solution and often frustration for customers. Our 25 products share one common code base, one engine, one console, and one network, providing both better efficiency and a seamless customer experience. And our NewEdge private cloud runs Netskope, Inc.'s full stack of products at high speed at all of our more than 120 locations. To illustrate how our customers are adopting our Netskope One platform, let me pivot to our go-to-market accomplishments during Q4. We saw significant customer wins across verticals and geographies, with customers turning to the Netskope One platform to enable AI adoption, modernize their security and infrastructure, consolidate vendors, and replace legacy and first-generation cloud security products. I will touch on some key wins and expansions across common use cases. First, customers are choosing the Netskope One platform for modernization to facilitate secure access from human and nonhuman identities to their AI ecosystem, including generative AI apps and LLMs, cloud apps, web apps, and private apps. One notable win was a large global manufacturer who sought better data visibility and control and the ability to safely allow the use of AI in cloud. They chose six Netskope, Inc. products to secure generative AI and cloud access, protect their data, and improve their network performance. We also landed a top regional health system in the US who initiated a modernization selection process to replace its legacy security and network infrastructure after previously suffering a severe and costly breach. We shined in this competitive bake-off, and the customer purchased 11 products within our Netskope One platform, including our next-generation SWG with AI controls, ZTNA Next, Advanced DLP (which includes proprietary AI models from our AI labs team), Borderless WAN, Cloud Firewall, Enterprise Browser, and other products to replace legacy firewall and networking products. Customers also continue to turn to Netskope, Inc. for our superior unified data protection. For example, one of the largest hotel companies in the world with operations in nearly 150 countries was a notable unified data expansion win during the quarter. This client needed continuous real-time visibility into the full breadth of its data security posture. They also needed to confidently manage and protect sensitive data across cloud, on-premises, and hybrid environments including AI and cloud data stored. They purchased Netskope, Inc.'s DSPM solution and are now using 14 products in the Netskope One platform across its organization. Many customers also deploy our suite of Netskope One to modernize their infrastructure, including replacing legacy VPNs with our zero trust architecture, branch firewalls with our Borderless SD-WANs, and migrating their networks to our high-performance private cloud, especially as they adopt more AI and cloud where performance becomes even more critical. For example, we landed a Canadian gaming company that needed to modernize their network for AI and cloud, provide secure remote access to their global workforce, and meet governmental regulatory requirements. This customer replaced legacy hardware products at more than 5,000 locations with Netskope, Inc.'s Borderless SD-WAN and ZTNA Next secure access solutions and purchased our Next-Gen Secure Web Gateway, with added AI protections, for secure generative AI usage. In another win, a European government chose us to modernize its legacy on-prem security infrastructure and drive data sovereignty. They wanted to consolidate multiple point solutions into a single centrally managed platform to protect sensitive data while meeting strict government regulatory requirements. The organization purchased our comprehensive Netskope SSE platform covering security for AI, web, cloud, and data. Finally, our global fast and resilient NewEdge private cloud network makes us particularly well suited to deliver globally distributed and highly regulated customers the data sovereignty and regulatory compliance that they require. For example, we landed two of the largest banks in Africa in two separate deals. One was a unified data protection deal that we successfully baked off against a primary competitor. The other was a network modernization deal where we replaced the same competitor with Netskope, Inc.'s market-leading SSE solutions and higher-performing NewEdge private cloud. Our local data centers in Africa were a driver for the wins, as we are able to deliver superior performance and data sovereignty to these customers. The geographic and vertical diversity of these customer wins and use cases is a testament to our clear technical differentiation and disciplined execution across all regions. Our new customer wins were all competitive bake-offs against primary competitors, where the capabilities of the Netskope, Inc. platform proved itself in extensive POVs. We continue to land with multiple products and have seen strong growth in multiproduct adoption across our customer base. As of the end of Q4, 56% of our customers were using four or more Netskope One products, and 27% were using six or more products. I am pleased with the strong performance of our go-to-market team across the globe. Our newly hired sales reps are ramping, and our tenured reps are delivering strong productivity. We put great leaders in place and recently filled some of our remaining key sales leadership positions, including the appointment of Joe Welch to lead our US public sector vertical, an area where we are underpenetrated but have strong opportunities. Joe is a seasoned veteran with decades of public sector experience in this space. We are also continuing to hire highly talented reps in all geographies, many of whom are joining us from key competitors across our space. I just returned from our annual sales kickoff, and I can tell you that our team's excitement, energy, and conviction is truly palpable. Our momentum is only building. As part of our comprehensive go-to-market strategy, we also continue to strengthen our relationships with system integrators and strategic partners. During Q4, we partnered with the largest GSI in the world on a major enterprise deal in the energy sector, supporting digital transformation and zero trust for approximately 80,000 employees. Other recent engagements include a large government defense customer in Asia Pacific and a major health care customer in North America. This key partner holds over 150 certifications on the Netskope, Inc. platform, and their support extends our global operations. This is just one example of how we are partnering well on large-scale, partner-driven enterprise transformations globally. On the technology partner side, Netskope, Inc. also recently achieved the Amazon Web Services Security Competency status for AI Security. This competency assures AWS customers that Netskope, Inc. has met technical and quality standards to deliver best-in-class solutions for securing AI workloads across AI security use cases. In closing, I want to reiterate that we are in the early innings of an AI super cycle that is exposing a fundamental flaw in legacy and first-generation SASE architecture. Legacy security acts as a latency tax on AI performance, forcing enterprises to choose between safety and speed. We believe the next decade will be defined by a structural shift towards an intelligent edge architecture built specifically for an autonomous agentic economy. Netskope, Inc. is uniquely positioned for this era for three reasons. First, we have an architecture for the future. While legacy vendors proxy the past, Netskope, Inc. is the distinctly AI-native proxy with innate fluency to secure the languages of the future—APIs, JSON, and the emerging protocols like MCP. Two, we also scale without friction. We have eliminated the security tax. Our AI Fastpath infrastructure has unique capabilities to perform complex, real-time security at the speed of AI inference. And three, finally, we are an intelligence moat. Our advantage is rooted in active context and the real-time AI-fluent proprietary data we generate. While others count traffic, we understand intent. Our proprietary data from trillions of real-time transactions, validated by the Netskope AI Index, makes us the indispensable source of truth for the AI economy. Sitting squarely at the intersection of cloud, AI, networking, and security, Netskope, Inc. has a massive market opportunity, which is projected to grow to at least $149 billion by 2028. We have just begun to scratch the surface and look forward to what is to come. The plumbing of the AI era is being laid today, and it will take many years to fully realize. By unifying high-speed performance with deep semantic intelligence, Netskope, Inc. is not just selling a platform. We are providing the essential adaptive fabric to the modern AI enterprise. For the next, 2026 was an incredible year of growth and expansion for Netskope, Inc., and our IPO in September was just the beginning of our public company journey. We see an incredible path ahead as we attack the AI security and networking opportunity with exciting new products, continue to bring more customers onto our platform, expand business with existing ones, drive further innovation, ramp our sales team, and drive awareness globally. I am proud of what we have accomplished—particularly our first full year of positive free cash flow generation and industry-leading ARR growth at scale. I look forward to seeing many of you at RSA in a few weeks, where we will demonstrate and share more about our AI strategy and new products, and engage in other ways in the months ahead. With that, let me now turn it over to Andrew to provide financial details on the fourth quarter and our outlook for the first quarter and fiscal year 2027. Andrew?

Thank you, Sanjay, and hello, everyone. As Sanjay shared, Netskope, Inc. had a very successful fourth quarter, closing out the year on a strong note. We continue to deliver significant growth as our investments in NewEdge, new product innovation, and our go-to-market organization continue to pay off. Before I share Q4 and fiscal year 2026 results, let me remind you that all financial comparisons are on both a year-over-year and non-GAAP basis unless stated otherwise. For the full year 2026, we are proud of what we accomplished. We delivered revenue of $709 million, or 32% growth; ARR of $811 million, up 31% year over year; net new ARR of $193 million, up 35% versus fiscal 2025; operating margin improvement of 18 percentage points while continuing to invest in our innovation and go-to-market engines; and we generated $12 million in positive free cash flow, which marks Netskope, Inc.'s first fiscal year of positive free cash flow and an improvement of $163 million over fiscal 2025. This translates to a 30 percentage point free cash flow margin improvement year over year. Moving on to Q4 results. ARR grew 31% to $811 million at the end of Q4. As Sanjay noted, we also had a record quarter for net new ARR of $57 million. Q4 revenue grew 32% to $196 million. We also experienced strength across geographies. In Q4, revenue in the Americas grew 32%, EMEA increased 36%, and APJ grew 26%. Our teams executed well, and our investments in our sales organization are paying off. In terms of customer metrics, the number of customers generating more than $100,000 in ARR in Q4 grew 22% year over year to 1,531. Enterprise and large enterprise customers are our focus, and more than 85% of our ARR comes from $100,000-plus ARR customers. Note that the average ARR from this customer cohort grew to more than $450,000 per customer. This is indicative of our success in both expanding our installed base and securing significant new enterprise deployments. Our Q4 net retention rate, or NRR, was 116%, while our churn and downsell rates remained at historic lows. Composition of deals varies quarter by quarter, but our consistently strong NRR reflects our customers' ongoing confidence in Netskope, Inc.'s platform and expansion of their deployments as they consolidate vendors and modernize their infrastructure. Customers view Netskope, Inc. as a long-term strategic partner given our commitment to innovation and ability to deliver products that solve the complex and evolving security challenges in the cloud and AI era. In addition to NRR, we look at multiproduct adoption to demonstrate our expansion opportunity within our customer base. As Sanjay mentioned, at the end of Q4, 56% of our customers were using four or more products versus 48% a year ago, and 27% were using six or more products, up from 22% a year ago. We are pleased with this progress and believe our 25-product Netskope One platform gives us a clear opportunity to continually expand within our growing customer base as they consolidate more of their security and networking stack with us. Moving on to the rest of the income statement. We saw the benefits of Netskope, Inc. being built to scale. Gross margin was 76%, an increase of approximately five percentage points from Q4 last year. Our gross margin expansion is being driven by the efficiency of our NewEdge architecture, which is generating better unit economics as we scale. Q4 operating expenses totaled $171 million, up approximately 3% sequentially. Operating margin improved five percentage points year over year to negative 10%. R&D expenses improved 100 basis points year over year to 36% of revenue, driven by earlier investments in a common data platform and hiring in high-talent, cost-efficient locations. Sales and marketing expenses remained flat at 40% of revenue as we continue to invest in quota-carrying sales reps. Our consistent improvement in gross margin and operating margin reflect the operating leverage we have unlocked as our earlier strategic investments in infrastructure and talent begin to compound. Net loss per share was $0.04 using 395 million weighted average shares outstanding. As a reminder, our non-GAAP EPS excludes the change in fair value of the convertible notes we issued prior to our IPO. Fully diluted share count using the treasury stock method was approximately 503 million shares as of 01/31/2026. We generated $4 million in free cash flow in Q4, representing a 2% free cash flow margin. Note that this was driven by our laser focus on efficiencies and in the first year of our transition to annual billings. We are pleased with our ability to drive positive free cash flow, as this demonstrates the leverage inherent in our model. While we will continue to realize the benefits of being built to scale on margins and cash flow, our path to sustainable positive free cash flow is not expected to be linear. The timing of cash collections can vary quarter to quarter, and we expect to continue investing in the business for long-term growth. And finally, we ended the fourth quarter with $1.2 billion in cash, cash equivalents, and marketable securities. Before I share our guidance for the first quarter and fiscal year 2027, let me briefly outline some factors that should be considered. We are continuing to make investments in our business, most notably in R&D and sales and marketing. We are continuing to hire sales reps across the globe to support our expanding market opportunity aligned to the AI super cycle that Sanjay noted. At the same time, we are leaning further into our AI roadmap and expanding our AI-native Netskope One platform with additional products to support our customers' AI adoption journeys both today and in the future. While we are adding AI engineers and data scientists to drive further innovation in this important emerging area, we are also empowering our teams with AI tools to drive efficiencies in development and other areas of our business. We expect to see most of the impact from these investments to operating margin during the first half of the year, leading to improving operating margin in the second half of the year. As we look at gross margin, we are on track to achieve our long-term target of 80%. With the foundational investments we have made in NewEdge, we now expect margin gains to come through top-line growth and continued optimization. Now that gross margins improved into the mid-seventies, we expect progress from here to be more gradual and may not follow the linear step function seen in recent quarters. Also, as we have discussed in the past, we are shifting customers to annual billing on multiyear contracts where possible. Billing annually will improve predictability and consistency of our cash flows. I am pleased to highlight that this transition is occurring faster than we originally expected. While it is difficult to predict exactly how this will impact future free cash flow, we expect to see the most significant impact in Q1 with negative free cash flow in the range of $50 million to $60 million. We expect that to improve in the second quarter, return to positive free cash flow during the second half of the year, and to end the full year with positive free cash flow in the range of 2% to 4%. We will continue to provide you with quarterly updates as we progress throughout the year. We began this billing transition a year ago and expect to see the bulk of the impact this year. And finally, we believe we are uniquely positioned as a significant beneficiary of the AI super cycle due to our unified AI-native fabric that eliminates the trade-off between performance and security. At the same time, we are early in the year, still have a large portion of our sales reps ramping, and we are continuing to establish our reporting cadence as a public company. And while AI and cloud adoption are driving significant interest in platforms like Netskope, Inc., we recognize that macro and geopolitical factors have the potential to impact customer spending plans. We have built our guidance with these factors in mind. Let me now provide our guidance for Q1 and fiscal year 2027. As a reminder, these numbers are all non-GAAP unless stated otherwise. For Q1 fiscal 2027, we expect revenue in the range of $197 million to $199 million, representing growth of approximately 26% at the midpoint; operating margin of approximately negative 16%; net loss per share of $0.06 to $0.07 using approximately 405 million weighted average common shares outstanding. We expect to see the largest free cash flow impact of our transition to annual billings in 2027 with much of that impact in Q1. As I mentioned, we expect negative free cash flow in Q1 of $50 million to $60 million. For the full year fiscal 2027, we expect revenue in the range of $870 million to $876 million, representing growth of approximately 23% at the midpoint; gross margin of approximately 77%; operating margin of approximately negative 10%, gradually improving from negative 16% in the first half of the year; net loss per share of $0.19 using approximately 415 million weighted average common shares outstanding; free cash flow margin in the range of 2% to 4%. Note that the annual billings transition is estimated to reduce our free cash flow margin by approximately six percentage points, which is reflected in this guidance. As noted earlier, we expect that to improve in the second quarter, return to positive free cash flow during the second half of the year, and end the year with positive free cash flow. We have highlighted these modeling points in the appendix of our investor presentation. In closing, we remain confident in our ability to execute on our long-term strategy and innovation, driving strong and durable revenue growth and capturing share of our expanding opportunity. We remain focused on prioritizing disciplined execution and strategic investments that strengthen our competitive advantage and continue to drive growth and margin expansion. Innovation drives our flywheel for growth. As such, we will continue to invest in data and AI engineers while utilizing AI to drive efficiency and product velocity. We will also continue to invest in go-to-market while remaining fiercely committed to delivering profitable growth. Thank you for your time today. With that, I will turn it over to the operator for Q&A.

Thank you. To withdraw your question, please press 1-1 again. We will now open for questions. Our first question comes from the line of Brian Essex with JPMorgan. Your line is open.

Great. Good afternoon. Thank you for taking the question and congrats on some solid results. Maybe one question for Sanjay and then a follow-up for Andrew. I guess, Sanjay, where would you assess that we are in the maturation cycle with respect to enterprises knowing what they need to secure AI? Are your AI security announcements ahead of the curve, or are these approaches that you are already seeing CIOs demand as they look to, kind of, you know, secure their, you know, AI estate? And then, you know, for Andrew, could you maybe just help us understand the context of the sequential revenue guide? Looks like Q1 would imply only up a couple of million dollars. So we would love to understand the puts and takes there. Thank you both.

Yes. Great question, Brian. So I think, first of all, from an AI perspective, most organizations are in the infancy. They are in the first inning. 90% of their usage of AI is shadow AI, meaning they actually did not bring it in, their end users did. And so when you think about that concept, you harken back to this really just being very early. And so from an AI security perspective, our focus is always to skate to where the puck is going, anticipate what they will need, and deliver a best-of-breed solution to solve this problem—discover their AI, guardrail it, control it, and then enable it with precision. And so that is what these new products do, building upon our previous capabilities to enable AI. So we will share more at RSA and beyond as well on that. Andrew?

Yeah. Thanks, Brian. In terms of the Q1—I think you are talking about Q1 guidance—again, first year as a public company, and so we are going to remain prudent, as we have said in the past, and so there is that. We do have reps ramping, and we talked about before they tend to ramp more later in the year, let us say, and we still have quite a bit of ramping going on with terms of the reps that have come in over the last year. And then finally, there are some geopolitical, macro headwinds that probably happened over the last, you know, I would say the last couple of weeks.

Right. Right. Thank you both. Very helpful on both fronts.

Thank you. Our next question comes from the line of Meta Marshall with Morgan Stanley.

Great. Thanks, and echo congratulations. Maybe for Sanjay, just in terms of, you know, are you seeing—I think during the IPO process, you kind of talked about these four main use cases that people were, kind of, coming in with. Are you seeing any changes in what either those use cases are, or as you start to expand more of the product portfolio that you are selling, just any changes to, kind of, where a majority of people are coming in? And then maybe a follow-up. Just in terms of, you know, maybe the net new ARR growth this quarter—net expansion stepping back from Q3—just any commentary on, kind of, what you saw there would be helpful.

Thanks. Great question. So from a use case perspective, when you look at our top use cases, they were, come in to help people enable cloud and web no matter where they are. The second was securing and enabling AI. I will say that has moved up in the stack. Every conversation I have, people come to us and say, look. We already run all our AI traffic through you. We released the Netskope AI Index today—it is probably the first definitive source of worldwide AI tracking by vertical, by geo, and by size of customer. Well, that kind of shows you the amount of AI traffic traversing the NewEdge network. And so what people have come to us to say is, look. You are the Fastpath to AI. Help us secure it, enable it, guardrail it, and let us say yes to it. And so that is a top, top use case that they are coming to us with, and that has been elevated. Obviously, the other ones—remote access, modernize my infrastructure, converge, consolidate, simplify my network security app—all of those are still top of mind, but definitely the AI one has been raised. And so we are very excited about that, to be blunt, because we feel like, hey. This is what we were born for. Right? Our proxy is really a JSON, API, MCP-fluent proxy. Start with cloud and now AI. It is sort of a one-two punch in a good way for us. So we are very excited, obviously, about what is to come, to be blunt, in the many, many years because we are early, obviously, in the AI super cycle. As far as net new ARR, we had, obviously, a high comp in Q4 of last year. You can see that as you kind of metric it and you watch through that growth. We are, obviously, happy to record the highest net new ARR we have ever had. You saw the growth in our customers of over $100,000 in ARR, right, in 23-plus percent, and, obviously, strong upsell as well. And so for us, the other big point to remember is we really started hiring and ramping our reps mid year, so beginning in Q3 last year. It takes about 12 months for them to ramp to full productivity, and, and so that is another big piece for us that we continue to drive.

Great. Thanks. Thank you. Our next question comes from the line of Robbie Owens with Piper Sandler.

Great. Appreciate you taking my question this afternoon. Wanted to ask more high level just around revenue model. And as you think forward—and I know it has been disclosed here—you are primarily a seat-based model. And obviously, there are some concerns in the market what seat-based models look like going forward, especially in light of all the recent layoffs. So as you add new modules and new capabilities, do you see that shifting more either towards traffic or capacity or things that will—it will be an underlying seat-based model that you are protected by adding more modules on top. So would just love some color. Thanks.

Yeah. It is a great question. So when you look at what we do, we run the traffic for most enterprises. We run everything. All their generative AI traffic, all their agentic traffic, their cloud traffic, their on-prem traffic—it goes through us. The reality, though, is there is no free lunch on our network. And so if you are going to run users through our infrastructure, which is what obviously people do, you pay for that by user. If you are going to run agentic traffic, right, whether it is server-side or client-side, whether you have an AI agent, you pay by transaction. And so all of the new products we released today, they are charged by transaction. What is a transaction? It is a prompt and a response. Right? That is kind of the token for the agentic economy, and that is how we charge. So no matter what people run and what that balance is over time, we are going to make money off that. And so you will see, and you have already seen, four new products today—all transaction-based—which essentially maps to what you can think about as tokens.

Thank you. Our next question comes from the line of Gray Powell with BTIG. Your line is open.

Okay. Great. Thanks for taking the question. Yeah, so maybe one on the product side. So one of your larger network security peers, they appear pretty bulled up on the potential for improved demand in the SD-WAN markets and the opportunity for legacy replacement this year. Netskope, Inc. also often receives high marks on WAN capabilities. So I am just interested—what are you seeing in your pipeline, and then how often are you having discussions where both security and networking are buying centers that are involved in deals?

Yep. Great question. So first of all, you are right. Like, in an organization, when you map out the structure, you have a CIO and you have the security leader and the infrastructure ops leader. You also now have an AI leader, and we often train all our reps—go after that square. You have to hit all four. Now where buying decisions are made, it can be in one or it could be multiple. But we obviously hunt across all of those. For us, we are a networking and a security company for the cloud and AI era. Right? And so we think about consolidation of both. The SD-WAN—what does it do? It is for speed. It is for performance. It is for resilience. And that is how we view it. And so we offer it in software form factor on your endpoint. Right? You can put it in your infrastructure. And we have seen great growth in it. You saw a great win we had in a very large distributed organization where they combined our SD-WAN as a smart on-ramp to our NewEdge network and all our security functionality. And so that concept, often called unified SASE by analysts, for us, we can deliver on that. And so what do I see in the future? Well, look at agentic traffic. The key is that agentic traffic is going to come from a user working remote. It is going to come from an oil rig, which is running AI on it. It is going to come from agents, right—many of them running on servers. All of that traffic needs to be accelerated. And that is really what the AI Fastpath is. We are the best path for agentic and non-agentic traffic, whether you are doing inference or beyond. So SD-WAN is just one small part of that fast story.

Okay. Thank you very much. That was helpful. Thank you.

Next question comes from the line of Matthew Hedberg with RBC. Your line is open.

Great. Thanks for taking my question, guys. Andrew, I think in your prepared remarks, I am curious—was that you said deal composition can change from quarter to quarter, sort of the reason why NRR ticked down by a couple 100 basis points? Or just, I am just trying to get a little more clarity on that element.

Well, first of all, we view a 116% NRR as very strong, to be frank. I think anything in the mid to upper teens is something we would be very happy with, Matt. But look. NRR does vary quarter to quarter. Some quarters, we have more upsell. Some quarters, we have more new logo revenue. You know what? I think we have said that before. And note that Q4 a year ago was one of the strongest, if not, you know, a record quarter from an upsell perspective—Q4 of FY '25. That being said, looking forward, we have a large installed base. Average customer has, I think, 4.4 products. We have 25-plus products, four new products announced today—again, as Sanjay said, transaction-based—so a lot of white space and, you know, hopefully, a lot of upside there. And just want to mention that downsell and churn remain at historic lows. So retention remains very strong.

Got it. Thanks, Andrew.

Thank you. Our next question comes from the line of Brad Zelnick with Deutsche Bank. Your line is open.

Great. Thank you so much for taking the questions. A lot of good information that you have revealed, you know, in these results. I have got one for Sanjay, one for Andrew. Sanjay, you spoke to a lot of this in your remarks, but I just want to hit it head on. It is great to see the unveiling of Netskope One AI Security today, and I think there is consensus that network traffic will grow exponentially as AI agents are rolled out into production. My question is, with the massive throughput requirements that agentic east-west traffic may demand, why is SASE and more specifically Netskope, Inc. best positioned to secure this traffic versus maybe a virtual firewall vendor? And then just quickly for Andrew—Andrew, just why is the shift to annual billings happening faster, and should we expect to see that result in maybe an unexpected benefit to ARR and revenue as you get better pricing?

Thank you very much. Thanks for the question. So when you look at agentic traffic, what is, like, an AI agent doing, and what are people most worried about it doing? Well, an AI agent unleashed will go access your endpoint. Guess what? Netskope, Inc.—we monitor that. We have our endpoint data protection. It will go access your cloud apps, right, over the Internet. That is what we do. We monitor it, understand what are they accessing, restrict what it can access dynamically, whether it is a shadow agent or not. Your on-prem data—that is what our AI-enabled ZTNA does. And so I guess the summary is when you look at what Netskope, Inc. does, we have a sensor that sees all traffic that goes back on-prem, to your cloud, to your AI applications—no matter where it goes—to a website. We also have a sensor on the endpoint where we do our data protection and beyond. And then we also have a sensor which looks at all out-of-band activity, right, when you look at our lineage around understanding how these applications work, with CASB and beyond. And so we are in this unique spot where the world is about—do you have unique data? Can you generate proprietary data that no one else can see or has? And that is what we do. Because we are the most performant, largest cloud private network, because we have the ability to interpret this data at a much more granular level, we understand the agentic interactions at that granular detail. And as a result, our policy enforcement—our 1,000 of them have chosen us to secure their agentic traffic.

Very helpful.

Yeah. And, Brad, great question on the billings. Look. I would remind everybody that, you know, the billings transition provides strong predictability and consistency of both billings and free cash flow, ultimately. We added a slide 24 to help illustrate the transition and where we are. I would point everybody to the 78% growth in the future billing commitments—the future committed billings. And the interesting part about that is we can see what is coming. We can actually see the dates we bill. We can obviously model collections better. And, again, we have been free cash flow positive, and that will, obviously, tilt up later in the year. But as far as, like, why going faster? It is just really strong execution. We have been very focused on it internally. We have been inspecting the deals, so to speak, and making sure that we are communicating with the salespeople and helping them through the transition, along with our customers. And then just in terms of pricing, I mean, the way we really think about pricing is we focus on value. You know, we have high win rates, and so pricing to us is more about selling the value of our products. And quite frankly, you know, we will continue to focus on that. We have new products to offer—I think a stronger story with the new AI products coming out—and those are the things I would really look to, to strengthen the trend on pricing.

Awesome. Thank you so much for taking my questions.

Thank you. Our next question comes from the line of Jonathan Ho with William Blair. Your line is open.

In terms of your profitability guide for 2026, I know you talked a little bit about investments. You help us understand maybe where you see the most opportunity to place those investments? And what would be, sort of, the timeframe for us to see perhaps an inflection in growth as you spend more on R&D and sales and marketing? Thank you.

Yep. Great question. So from an investment perspective, obviously, you have seen our yearly guide, but you also saw that we are investing upfront. And when that upfront investment is, it is really in AI—continuing to AI-enable our R&D team. So when you look at the world today that we live in, I believe that every engineer can be a 10-times engineer. And AI is not about by coding something or so on. It is about making your elite engineers 10 times more productive and 10 times more focused on architecture. And so what do you have to do to enable that? Well, you want to invest in AI orchestration. That could be to help them automate workflows, to automate their validation and testing, to automate, sort of, the rote stuff that they have to do, so they can focus on the unique part. And so that is what we are doing in Q1—investing in that in the first half, in that AI tooling. Now what you will see after that is you will see in the second half and beyond that we really do not need to ramp our R&D in terms of headcount as what you may have thought, right? We can be a lot more efficient. And so this is about laying continually the groundwork for R&D efficiency. You have got to invest a little in AI tooling, and then you see a lot of that benefit from an R&D leverage. And you will see that, obviously, as we continue our R&D percentage of revenue downwards. And so that is probably one of our bigger investments. The second is in the sales and marketing. We mentioned that really mid last year, we started bringing on more reps, and those reps take about 12 months to ramp. Well, one, not only do we continue to invest in enabling them, but we are hiring more teams, right? And we know what is in front of us in terms of the TAM for the next decade—one of the most durable TAMs you will ever find in any industry, including security, where we operate on the far right of security, right? We operate the network. We operate the infrastructure, the highway, to everything that you can think of. And so we want to take advantage of that and continue to ramp and hire from a sales perspective. But we are doing that very responsibly, with this notion of being very efficient in R&D by investing in tooling. And so that is really our upfront investments in the first half. And that is why you see what you saw from the guide on Q1, Q2 versus the rest.

Thank you. Thank you. Our next question comes from the line of Richard Poland with Wells Fargo. Your line is open.

Hey. Thanks for taking my question. Just a quick one for me. I think it was Andrew—you mentioned the geopolitical, macro headwinds kind of happening over the last couple of weeks. I just wanted to clarify on that. Is that something that, you know, you are starting to see show up in demand and pipeline? Or is it just, kind of, you are observing what is going on in the macro environment, so you are taking some extra cautionary steps in the guide. Alright.

Fair question, Rich. I think, you know, it is something—I think we can all recognize that there have been more events in the last couple of weeks. So it is something just to consider in terms of being prudent, in our mind. To keep in mind, we have a, in terms of that area of the world, so to speak, we have a very small percentage of our business. So I do not—it is less about that and just more about, you know, what I would call kind of a more macroeconomic risk.

Okay. Great. Thanks, guys. Just prudence.

Thank you. Our next question comes from the line of Shrenik Kothari with Baird. Your line is open.

Yeah. Thanks for taking my question. So the AI Fastpath is really, as you said, shifts focus from not just securing AI to securing at scale with AI-native fabric and the new modules that you announced. So as it pulls the conversation away from, like, traditional kind of FTE-based pay cost towards more broader discussion, can you talk a little bit about how the AI Fastpath has been progressing—your pipeline right now? And then I have a quick follow-up. Thanks.

Sure. Yeah. It is a great question. Like, we have always believed that ultimately nobody implements security unless it has a great end user experience. In the agentic world, performance matters more. Agents talk constantly, right? They can talk at a rate that is 100 times a human. And so it accentuates the need for a fabric that can operate and perform and be resilient worldwide. If you look at our infrastructure, it is the largest private cloud in the world. It is the largest highway or airspace for AI. And so those 120-plus data centers, with our architecture and software and memory operating at high speed on all agentic traffic—that is a huge advantage for us. And what we tell customers is just try it. Just measure it. You will see a very, very noticeable performance difference. Whether you are an AI agent or you are an application, you are a user, right? You are an IoT device. And so the AI Fastpath is the next evolution of that for the AI era. You are going to a coding application, right? You are going to any of the thousands of generative AI apps you can see on the AI Index. We are going to be the fastest path to get there. We are going to handle that. We are not going to throw it on the public Internet. We are going to get you there directly. And so for us, the AI Fastpath is a big part of how we think about the agentic era—its performance, resilience, in addition to security—and we are combining them all.

Thank you. Our next question comes from the line of Eric Heath with KeyBanc. Your line is open.

Hey, thanks for squeezing me in and solid finish to the year. Sanjay and Andrew, over 30%. Maybe just one for you, Sanjay, and maybe a quick one for Andrew. Sanjay, just following up on some of your comments about the customer wins in the quarter being, I think, all of them competitive bake-offs, and I think we all kind of really appreciate the static set of competitors it has been for a long time, but there are some incremental competitors out there that have popped up in the last couple of years. So curious if you could just talk to whether the competitive set—who you are bumping into in these deals—is changing at all. And then, Andrew, if I could, just any high-level guardrails you want to give us on ARR for the year would be great. Thanks.

Great. So from a competitive perspective, we have, you know, 25 products. We just released four. One of the great things about efficiency in R&D that you have seen—obviously, R&D percentage of revenue going down, obviously the supercharging of it with AI and the need to not, you know, not to hire as many from an R&D perspective—you are also seeing velocity increase. I think I previously said that we release on average two products a year or so. Well, we have already released four-plus, and I think that trend will continue for us. And so we are very excited, obviously, about that supercharging. And as a result, because of the breadth of what we do, we do see different competitors. For example, in the data protection area—which, you know, data, frankly, is what drives the agentic world—we would have seen still some, a lot of the legacy folks, right? You cannot imagine how much legacy Broadcom Blue Coat and all the rest is out there in Symantec and Trellix and so on. Whereas perhaps in the traditional kind of web world, proxying web, you would see your competitors that you may see in a Magic Quadrant that you would expect. And then when we delve into, sort of, what I called about the AI Fastpath—the performance—you really do not see anything there because the network is obviously just very different, very unique from that perspective. And so I think, like, we hit across a cross section of competitors. But what is noteworthy is our win rate of over 80% if we get to a POC, a proof of concept, right? That has held. And so our nirvana is just get to a POC—whether it is about enabling, securing AI, securing cloud, converging, consolidating your network infrastructure. That is why we are growing our sales teams. That is why we announced the GSI partnership and that win with the largest GSI. And that is why we continue, you know, to power through in the mid market with our MSPs. It is just—that is why we went public, to be blunt: drive awareness. And so that awareness takes time. It is coming. And we definitely have the platform that, when you get to knock that door open, we will win.

And, Eric, on ARR, again, you know, while we do not guide, maybe I can be helpful with how to think about modeling. You know, last quarter, we ported the history. I would do the same thing. You can see that, I think, ARR was about a point below revenue growth. So, you know, I would say if I were modeling, kind of, at a point above, point below—something like that, right in that range.

Awesome. Thank you, gentlemen.

Thank you. Our next question comes from the line of Shaul Eyal with TD Cowen. Your line is open.

Thank you. Hi, good afternoon. Andrew, maybe can you talk to us about ASP patterns in light of rising memory prices?

I will take that question. So for us, when you look, first of all, at our landing and our average ARR per deal size—you can calculate it—it continues, you know, for our customers to continue to go up. When you look at memory, I think that, in one case, people often talk about that as when you sell boxes and appliances and everything ships with memory. That is obviously not really what we do in the majority of cases. For us, it is our infrastructure. It is our network. What runs on it is our software. And so we feel good about our guide for this year in terms of incorporating what you just said. Obviously, that is a fluid environment, so we will watch that for next year. But we definitely feel good about the guidance we have given from a financial metric perspective that incorporates all of what you described. The reality is that for us, when you think about us, we process all this traffic. You can see it. You should go to ai-index.netskope.com. And when you look at that traffic, what matters there is what you do when you see it. And, ultimately, that, in many cases, is our moat. It is uniquely taking those transactions and generating very unique, granular data that can then inform your security policies, your security analytics, optimization of that, your guardrails, and so on. And so for us, obviously, we are excited about continuing to drive more into our existing infrastructure, which can more than handle what we need to drive for this year.

Thank you, Sanjay. Thank you. Our next question comes from the line of Trevor Walsh with Citizens. Your line is open.

Great. Hey, team. Thanks for taking the question. Maybe just a quick one for you, Sanjay. Just wanted to square some of the comments that you made both in the prepared remarks and your responses to some of the questions. You said that the AI revolution is exposing legacy architectures within SASE. Is that going to result in, like, just breaking of those legacy or more just dissatisfaction, just generally, with performance? And then secondarily to that, is there some sort of leading indicator that investors could use to just determine whether or not more of that breaking or dissatisfaction is going to come once AI and agent traffic is getting to a certain point? Maybe the AI Index you just released gives us clues there. Just trying to get a sense of when we really start seeing the wheels fall off, potentially, of other players, if that makes sense.

It is a good question. So I would look at it in two sides. One is the infrastructure and the network side, and one is security—because you kind of need both. On the infrastructure and network side, the agentic era will expose networks that were built, for example, in the public cloud, where you are going to get way worse performance. When you have more interactions back and forth, the performance difference becomes bigger, right? It became big with cloud. It will become bigger with AI. And so, one, your infrastructure. The second is, for us, we run all services everywhere—120 data centers. Everything we do runs everywhere. We do not hairpin people to a public cloud for one, to your own infrastructure for another. And so just the purity and the modernness of our architecture and our infrastructure, it leads to just better performance. And AI accentuates that. So, one, I do think the infrastructure and the network of others gets exposed. The second is, remember, since the beginning of Netskope, Inc., we have always said we are not trying to build a web proxy, right? We were building a modern API/JSON proxy. And it sounds technical, but what does it mean? The language of AI is that. The language of AI is APIs and JSON. I have a patent sitting outside my door here, which is real-time interpretation of Internet traffic at the API level. And the reality is that the AI era is about that. How do I say to someone that, hey, you can use a personal instance—or you cannot use a personal instance—of Gemini, but you can use a corporate version? And if you want to send sensitive data there, you can only do that with a corporate version. How do I have all these policies that guardrail and enable people to use AI, yet satisfy the business policies they want? You need something that truly understands the new language of the Internet, which is really what AI accentuates. And so for us, one of the engines to our car is a high-speed, distributed, in-memory, API/JSON proxy. That is unique. And so I remember this customer who came to me and said, Sanjay, I bought a SASE. I bought it, and it was working. But then I started adopting AI and cloud, and I have to bypass 70% of all traffic because all it can do is block the app or allow it. I do not want to block AI. I do not want to allow it either. I want something more granular. Right? And that customer moved all their traffic to Netskope, Inc., right? It is close to 100,000 users and agents and beyond. And they are very happy. And so I think that will happen more and more over time. But as you know, it is an enterprise, and an enterprise does not do things instantly. And so that will be a transition that will happen over the next many years.

Great. Thanks all. Appreciate it.

Ladies and gentlemen, due to the interest of time, our last question will come from the line of Michael Romanelli with Mizuho. Your line is open.

Yeah. Hey, guys. Thanks for squeezing me in here. So, Sanjay, you touched on this in, you know, prior response, but how does your sales capacity today compare to where you were a year ago, both in total as well as in the number of ramp reps? And then separately, I guess, how would you characterize or assess your pipeline, you know, as we head into fiscal 2027? Thanks.

Yeah. It is a great question. So for us, we obviously started ramping, hiring more reps really full force last year. And you can see that in, sort of, the S&M spend as well as it ramped early midyear last year. And it takes about 12 months for us to ramp those reps. And so if you look at that, it is really, for us, in the second half of the year when a lot of those reps will be fully ramped. And, by the way, for fully ramped—as you know, when you get a rep, we do not throw them into a place and give them a bunch of existing accounts. They are hunting new greenfield accounts. So they get on, they start hunting those accounts. They build their pipeline. They get the POC, do the MSA. That is why you have those ramp times, to be clear. And then we are continuing to hire. And so we are building that rep funnel for next year as well. And so, really, that is the best way for you to think about it—bunch of those fully ramped reps coming online in the second half of the year.

Beautiful. Okay. Great.

Thank you. I would now like to turn the call back over to Michelle for closing remarks.

Thank you, Towanda, and thank you all for joining us today and also staying a few minutes over. Look forward to engaging with you in the weeks and months ahead, including at RSA this month, where we will be sharing more about our AI strategy as well as demonstrating our newly announced AI products. Thank you all. Have a good evening.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.

And thank you for standing by. Welcome to Netskope Third Quarter Fiscal 2026 Earnings Conference Call. [Operator Instructions] I'd now like to hand the conference over to Michelle Spolver, Chief Communications and Investor Relations Officer. You may begin.

Good afternoon, and thank you for joining us today. With me on the call are Netskope's CEO and Co-Founder, Sanjay Beri; and CFO, Drew Del Matto. The press release announcing our financial results for the third quarter of fiscal year 2026 was issued earlier today and is posted to our Investor Relations website at investors.netskope.com, along with a supplemental presentation. Before we begin, let me remind everyone that some of the statements we make on today's call are forward-looking, including statements related to our guidance for the fourth quarter and full 2026 fiscal year, growth opportunities and competitive position. These forward-looking statements are subject to known and unknown risks and uncertainties, which could cause actual results to differ materially from those anticipated by these statements. Additionally, these statements apply only as of today, and we undertake no obligation to update them in the future. For a detailed description of the risks and uncertainties, please refer to our SEC filings as well as our earnings press release. Finally, unless otherwise noted, all financial metrics we discuss on this call other than revenue will be on an adjusted non-GAAP basis. We have provided reconciliations of these non-GAAP financial measures against the most directly comparable GAAP financial measures in our earnings press release. Now let me turn the call over to Sanjay to discuss our business and high-level Q3 financial performance.

Thanks, Michelle. Welcome, everyone, and thank you for joining us to discuss Netskope's third quarter fiscal year 2026 results. I'm very pleased to be here on our first public earnings call following our IPO in September. Our founding vision was anchored in redefining security and networking for the modern era of cloud and now redefining it for the modern era of cloud and AI. We see that vision realized every day. Netskope is the secure and fast on-ramp to everything enterprises access from the Internet, including websites, cloud and AI to their own infrastructure, private apps, LLMs and data centers. We are helping thousands of enterprises modernize and operate safely in both cloud and hybrid environments. This is happening in the context of an ever-evolving landscape of sophisticated threats, exploding data volumes and the fast accelerating revolution of AI. With a projected total available market size at $149 billion by 2028, Netskope's opportunity is massive, and we are truly just getting started. Turning to our Q3 metrics. I'm proud to say that we delivered very strong performance across all key metrics. Our team executed exceptionally well, continuing to expand our global footprint, innovate and extend our market-leading fully converged security networking and analytics platform and demonstrate accelerated top line growth while generating incremental leverage from our foundational investments. This strong execution resulted in a 34% year-over-year increase in annual recurring revenue, reaching $754 million and Q3 revenue growth of 33% to $184 million. Prior investments in our Netskope One platform and NewEdge global private cloud network continue to demonstrate significant leverage. We built Netskope to scale, and that is reflected in our ability to generate $11 million in free cash flow in Q3 as well as improved operating margin by 11 percentage points year-over-year and deliver free cash flow margin of 6%. Our Q3 results also showed robust performance across all geographies, driven by continued adoption of our Netskope One security networking and analytics platform of products. This adoption is reflected in a strong net retention rate of 118%. We also achieved broad vertical diversification, including expanding across financial services, health care, manufacturing, energy, retail and government. Drew will give more color on our Q3 financials and other key metrics in a few minutes. But first, let me share some context on the trends shaping our business and driving our momentum. Cloud and AI have completely revolutionized work. We are more dispersed, more productive and more automated than ever, and the pace of change is accelerating. Not since the Internet has there been such a transformative shift. Organizations today gain competitive advantages by leveraging a dynamic ecosystem of devices, applications and AI agents that interact and communicate using the modern language of the Internet. These interactions are accelerating in speed, scale and complexity, generating massive amounts of data across tens of thousands of SaaS and AI apps, websites, public cloud, on-premises systems, e-mail, endpoints and data stores. The vast majority of this data sits outside corporate IT's visibility and control, and the rapid adoption of generative and agentic AI is like throwing gasoline onto the fire, creating even more data, more ways to misuse data and more risk for data loss. Cloud and AI have also transformed the cyber threat landscape. Adversaries are finding new ways to trick organizations and their employees into downloading and opening high-risk file types, such as executables, archives, documents and scripts while evading inspection. They are also targeting cloud and SaaS apps directly, stealing tokens and credentials and luring victims into authorizing the attacker to directly access their data, bypassing the endpoint completely. These cyber threat actors are leveraging AI to accelerate their attacks, whether it be through deep fakes and social engineering or in finding zero-day vulnerabilities in software. This has created a need for modern security and networking solutions that enable organizations to use cloud apps and AI, but facilitate access in a way that doesn't put corporate assets at risk or degrade network performance. Legacy and first-generation cloud security and networking providers manage access to applications by giving administrators the binary option of blocking or allowing applications, thus creating a difficult trade-off between employee productivity and corporate security. These solutions were built during prior eras when security and networking requirements were different, users worked differently and attackers themselves were far less sophisticated. All of this reinforces why enterprise buyers are highly focused on making smarter investments in platforms built for the modern world of cloud and AI. They strive to spend more intelligently by cutting operational overhead and investments in legacy products that cannot address today's problems. Today, IT security and networking teams need a comprehensive yet adaptive approach to protecting their users and data while safely enabling the use of cloud and AI. And that is why Netskope was created. That is exactly what we deliver, and that is what is driving our growth and market leadership. For those new to the Netskope story, let me explain. Netskope sits at the intersection of security, networking, cloud and AI. We uniquely enable enterprises to modernize their security networks and use the cloud and AI securely in their organizations, all while delivering an exceptional end-user experience. Our Netskope One platform was designed for a world where users, devices, applications and AI agents can access anything from anywhere. Our platform reads the language of the modern Internet, including APIs, JSON-based data flows and machine-to-machine protocols. It understands digital interactions at a granular level, determines who or what is involved, what they're trying to do and with which data. We can then enforce granular policies and put appropriate guardrails in place to allow IT business leaders to safely say yes instead of no to unleash innovation, business efficiencies and intelligence from the cloud, web, SaaS apps, private apps and AI, including generative AI. We also understand data and data interactions with unmatched precision and context. We discover, classify, analyze and protect data in real time, in motion and at rest either in SaaS apps, public cloud, generative AIOs, agentic AI workflows, websites, e-mail endpoints, data lakes or on-prem apps. We can track movement of that data across different parts of an organization and make sure it's being used in the right way by enabling organizations to implement granular policies around their most sensitive data based on risk and context. We do all this through our Netskope One platform of over 20 security networking and analytics products that were purpose-built organically from the ground up to be unified. One engine, one console, one client, one gateway and one global network that all operate seamlessly and simply together to deliver the best security and performance with fewer resources to implement and operate. This is an important distinction for Netskope and our customers. It means that when customers adopt one of our Netskope One products, it's much easier and efficient for them to implement and operate the second, third and subsequent products. Our customers view this as a tremendous benefit and realize that all platforms are not created equal. A platform isn't merely a collection of organic and inorganic products bundled under one price list. A true platform is defined by genuine integration and seamless unification. Customers also get an exceptional end-user experience from Netskope. This is in part due to the fact that our Netskope One products all run on our NewEdge private cloud network, which is one of the world's most connected and high-performing networks. NewEdge has been architected to be an intelligent, highly scalable, low-latency global network with each data center designed to run our full stack of integrated products at high speed to every customer worldwide. In security, there's always been a paradox that if you add functionality, it makes things slower and the end user experience worse. Netskope shatters this paradox with NewEdge and our Netskope One platform. By converging security networking and analytics and a unified platform on NewEdge with shared context, intelligence and policy enforcement, we reduced latency for end users even in the largest, most complex environments and also provide data sovereignty not afforded with other infrastructures. To do this correctly, we also recognize that network infrastructure and operations teams need advanced capabilities. And so we built products like Netskope One DNS-as-a-Service, Cloud Packet Stream and Dedicated Egress IP addresses so that our customers could regain control over how traffic gets managed. In many cases, NewEdge becomes our customers' new network, ensuring high security without degrading network performance or the user experience. Finally, it's important to point out that AI is foundational to the Netskope One platform. It is not an add-on or a feature. It is fundamental to how we operate and even innovate. AI is intrinsically woven into our platform for superior threat detection, proactive data protection, digital experience management and the enablement of the adaptive real-time policy enforcement I just mentioned. Our commitment in this area is powered by 2 distinct world-class internal teams that work closely together and have been in place for many years. Our Netskope Threat Labs, a team whose experts have discovered over 1,400 zero-day threats in the wild and Netskope AI Labs, which has created more than 170 proprietary AI and ML models and holds over 50 patents specific to AI and ML applications in security. These teams ensure that our platforms remain technologically superior and ahead of the constantly evolving cyber threat curve. I've spent a lot of time over the past months in one-on-one small group and advisory Board meetings with customers and prospects around the world. Across my many discussions, one theme stood out, how to safely adopt cloud and AI at scale. Organizations want to modernize their security and infrastructure, reduce technology sprawl, safeguard sensitive data, ensure data sovereignty and manage GenAI and AI safely. The adoption of GenAI and custom AI tools is occurring at lightning speed. And with it comes even more data, a new and more complex attack surface and the need for internal resources to manage and secure these tools. IT leaders want to responsibly allow employees to use productivity-enhancing AI apps and tools safely and with appropriate granular guardrails to reduce risk while actively fostering innovation and efficiency. They also want to safely use AI models and apps to connect to internal and external tools and data sources, allowing the AI to perform actions like accessing files, querying databases or calling APIs. Netskope has a distinctive ability to help customers achieve this balance based on the technology differentiators I just explained. This includes understanding the modern language of GenAI apps and their detailed digital interactions with both humans and nonhumans at a very granular level. For example, the preciseness and depth of our ability to recognize the AI application, trusted originating device browser user or agent, the instance of the app, the activity being performed, the data being transacted with and returned and the normal behavior expected and troublesome deviations. This all leads to broad and precise discovery, visibility and protection and granular adaptive policy enforcement for AI. We have over 1,000 customers using us today to protect GenAI interactions, and this number is continuing to grow quickly. When securing AI end-to-end, it helps to use the analogy of a house. AI has a basement, a back door and a front door. The basement is the AI platform itself, which must be scanned for vulnerabilities, misconfigs and unintended access and includes proprietary data used by LLMs that requires granular controls to keep sensitive information locked down. The back door represents interactions with external data, LLMs, MCP and other agent-to-agent traffic, which must be monitored and secured in real time. The front door is where users and agents interact with AI and production, requiring granular controls on prompts and responses to prevent data leakage and block malicious behavior. And of course, every other entry point must be protected so that AI systems and data are accessed only as intended. Our current platform enables customers to protect key areas of this AI house, and we have many exciting innovations on the horizon in this area. Let me now pivot to some of our key achievements during the third quarter, beginning with go-to-market. We saw significant customer wins across verticals and geographies. We landed important net new and expansion wins with customers seeking to modernize their security and infrastructure, address greenfield use cases, consolidate vendors and replace legacy and first-generation cloud security products with our Netskope One platform. Common use cases included enabling fast and secure cloud, web and AI access and secure application usage, including for generative AI apps, achieving highly effective and efficient unified data awareness, protection and loss prevention, both for data in motion and at rest and simplifying and modernizing infrastructure, including replacing legacy VPNs with our Zero Trust architecture, branch firewalls with our SD-WANs and migrating their networks to our high-performance private cloud. Notable wins during the quarter included a Fortune 200 biotechnology company that replaced multiple legacy and first-generation cloud security tools with a unified SASE deployment of over a dozen Netskope One products. Also, a Fortune 50 global pharmaceutical retailer that selected Netskope to redesign their Internet edge connectivity supporting 50,000 employees in 8,000 locations. They purchased several Netskope One products to construct the Zero Trust architecture for their globally distributed enterprise environment and safe AI, cloud and SaaS app usage, including generative AI. We also won a global manufacturing and energy conglomerate that chose Netskope for data protection, secure cloud access and NewEdge global scale connectivity to meet strict data sovereignty requirements. And finally, a financial institution that previously attempted to modernize its environment using another cloud security vendor, but was unable to get the implementation operational due to platform complexity and architectural overhead. They selected Netskope for true platform unification, from network to gateway to client and to console across all their use cases, including secure web access, data security posture management, Zero Trust application access, cloud firewall and SD-WAN. All these new logos were won against primary competitors due to Netskope's superior technology that shined in bake-offs. And all were platform wins that included multiple Netskope One products. Multiproduct adoption has been increasing and is a key driver of our accelerating ARR and strong NRR. As of the end of Q3, 53% of our customers were using more than 4 Netskope One products and 26% were using more than 6. Expanding with existing customers through cross-sell and upsell of more products as well as more regions, more applications or more users represents a large growth driver for us, and we continue to execute well on this in Q3. A few notable expansion wins were a major SSE contract with one of the largest U.S. federal civilian agencies that increased from a piloted project of a few Netskope products for 7,000 users to 8 products for 300,000 users. Netskope was selected to address critical security needs, meet M-21-31 cybersecurity requirements across levels EL1, 2 and 3 and protect sensitive data across all cloud apps. We delivered a single FedRAMP High platform with no reliance on VPNs. That enables efficient, modern Zero Trust, advanced security and meaningful cost savings. And we also won another sizable multiproduct expansion deal for a large SASE deployment. This customer, a leading supplier to the global automotive industry, began its journey with us 2 years ago, initially purchasing a small footprint of core products for a small portion of its geographic footprint. In Q3, they expanded to 7 products across the Netskope One platform and tripled the number of global locations. As these and many other customer wins validate, our differentiated technology, innovative vision and customer-first philosophy are key elements in our success. They are also consistently validated by important technology industry analysts who have broadly recognized Netskope as a leader across several key markets. Netskope's placement as a leader in both the 2025 Gartner Magic Quadrant for Secure Services Edge for 4 consecutive years and a leader in the 2025 Magic Quadrant for SASE platforms for 2 consecutive years serves as an undeniable testament to this. In Q3, we were also named a leader in the Forrester Wave for SASE, scoring the highest overall among all vendors as well as scoring highest within its strength of offering category. And Netskope was also recognized as a leader in GigaOm's Radar reports for both data loss prevention and SD-WAN solutions, all testament to our superior technology, competitive advantage and astute and innovative vision. Our market leadership and industry recognition stems largely from our strong focus on innovation. I've long believed that in security networking, companies either innovate or die. Netskope innovates. We innovate constantly to help our customers stay ahead in the relentless battle against cyber criminals and navigate the ever-evolving digital threat landscape. Our customers appreciate the organic built ground up and truly integrated benefits of our offerings and the Netskope One platform. During the third quarter, we delivered several security networking and AI innovations, including advancing our universal Zero Trust network access solution to extend Zero Trust to IoT and OT devices, improve dynamic risk assessment and enable the consolidation of legacy technologies beyond just VPN to also include network access control and virtual desktop infrastructure. We also continued our AI-powered innovations that improve the efficiency and effectiveness of security teams. This included an integrated AI agent for Netskope One private access that provides insight into existing ZTNA network topologies and private application configurations for automated natural language policy recommendations. This helps administrators reduce their attack surfaces and optimize network operations. Additionally, we began a limited release of our model context protocol server, which leverages this common language of AI to enable customers to easily and securely share Netskope security context with major LLMs like cloud desktop, Microsoft Copilot, Google Vertex or Amazon Bedrock to enhance critical enterprise workflows. On the networking side, we expanded our NewEdge private cloud with new data centers in Malaysia, Toronto, Hawaii and Oman to meet growing customer demand and our continued commitment to delivering best-in-class network performance. NewEdge now covers close to 80 major metropolitan areas with over 120 data centers globally. Remember, Netskope NewEdge was uniquely and meticulously designed. We do not play marketing games with how many regions or data centers we have. Unlike others, all our regions and data centers are available to every customer and all have full edge compute and run all services. We also released several new products stemming from our technology alliances with Microsoft and CrowdStrike. Netskope One now uniquely fully integrates with Microsoft Purview, combining Netskope's deep DLP enforcement with Purview's data classification policies. We also announced general availability of Netskope One advanced SSE for Microsoft Entra Global Secure Access and new protections for Microsoft 365 Copilot conversations, including GenAI queries, responses and AI-generated content, all using our market-leading data and threat protection delivered through our new CASB API for Microsoft 365 Copilot. Together, these integrations help Microsoft customers accelerate their Zero Trust journey while protecting users' data and applications without compromising performance or experience. And finally, through our strong technology alliance with CrowdStrike, we released a new Direct to Zero Trust app. which provides out-of-the-box integration between Netskope One and CrowdStrike Falcon to enable the bidirectional sharing of indicators of compromise without the need for extensive manual integration work by the customer. We operate in a market where superior technology matters a lot. We often get asked, what sets Netskope apart from others? What drives customer adoption and satisfaction and what fuels our market leadership. As market analysts and our thousands of customers validate, the core of our differentiation is our technology and the vision that it was born from. Innovation is the heartbeat of Netskope. We are committed to continuing to invest in R&D to drive innovations that expand our industry-leading security, networking and analytics platform and help our customers safely unleash the power of cloud and AI to stay ahead of the cybersecurity curve. In closing, I'm pleased with our Q3 performance and proud of our team for demonstrating the guts, resolve, integrity and tenacity that are at the core of Netskope's culture to execute incredibly well in our first quarter as a public company. Our innovation engine is delivering seamlessly integrated products that are pushing boundaries in AI security, data protection, networking and analytics. And our road map has many exciting solutions in these areas on the horizon. At the same time, our go-to-market engine and machine is [ revving ]. We continue to attract top industry talent to support growing demand, ramp our reps swiftly, leverage and expand our technology and channel partnerships and grow our brand awareness to drive incremental [ at bats ]. We look forward to the exciting road ahead and thank our customers, partners and you and long-standing investors for their support. With that, let me now turn it over to Drew to provide financial details on the third quarter and our outlook for the fourth quarter and fiscal year 2026. Drew?

Thank you, Sanjay, and hello, everyone. As Sanjay shared, Netskope delivered a very strong third quarter, highlighted by accelerating growth in both ARR and revenue. Our ongoing investments in innovation and our go-to-market motion are driving tangible results as noted by our 11 percentage point improvement in operating margin. Netskope is built to scale, which positions us very well for continued efficient growth. For those coming up to speed on Netskope, let me point out that we have a SaaS-based business model where we generate nearly all revenue through subscription sales of our cloud-based Netskope One platform of products. Because of this, we view ARR as an important metric in evaluating our current business performance. We generally price our subscriptions per user based on the scale of the customer's organization and the number of products deployed. I will now share the financial highlights for Q3 fiscal 2026. As a reminder, all financial comparisons are on both a year-over-year and a non-GAAP basis, unless stated otherwise. ARR growth accelerated to 34% and totaled $754 million at the end of Q3. Total Q3 revenue grew 33% to $184 million. We also experienced strong revenue growth across the geographies. Revenue in Americas grew 34%, EMEA increased 34% and APJ grew 29%. Our teams executed well, and our investments in our sales organizations are paying off. In terms of customer metrics, the number of customers generating more than $100,000 in ARR in Q3 grew 24% to 1,444. Enterprise and large enterprise segments are our focus and more than 85% of our ARR comes from $100,000-plus ARR customers. Furthermore, the average ARR from this key segment increased 10% year-over-year to more than $450,000 per customer. This is indicative of our success in both expanding our existing installed base and securing significant new enterprise deployments. Our Q3 net retention rate, or NRR, was 118%, consistent with what we saw in Q2. Our strong NRR illustrates both the enduring value and stickiness of our solutions with customers as well as our ability to effectively upsell additional products and use cases to our installed base. In addition to NRR, we look at multiproduct adoption to demonstrate our expansion opportunity within our customer base. As of the end of Q3, 53% were using 4 or more products and 26% were using 6 or more products. We're pleased with this product adoption and also know that we have meaningful white space opportunity for expansion by cross-selling our Netskope One platform of more than 20 products. Moving on to the rest of the income statement, where we saw the benefits of Netskope being built to scale. Gross margin was 75%, an increase of approximately 5 percentage points from Q3 last year. Our gross margin expansion is being driven by the efficiency of our NewEdge architecture, which is generating better unit economics as we scale. Q3 operating expenses totaled $166 million, up approximately 3% sequentially. We realized a modest benefit to operating expenses in the quarter from the timing of a few onetime items that are now expected to fall into Q4. As I shared a few minutes ago, operating margin improved 11 percentage points year-over-year to negative 15%. R&D was 38% of revenue in Q3, down 300 basis points year-over-year as we realized the benefits of early investments in a common data platform and hiring at high talent, cost-efficient locations. We also saw improving sales and marketing efficiency, which improved 300 basis points to 41% of revenue as we continue to invest in quota-carrying sales reps. Our consistent year-over-year improvement in both gross margin and operating margin demonstrate how we've built Netskope to grow and scale efficiently. Net loss per share was $0.10 using 245 million weighted average shares outstanding. Note that our non-GAAP EPS excludes the change in fair value of the convertible notes we issued when we were a private company. The magnitude of this adjustment is unpredictable and can vary significantly from quarter-to-quarter due to stock market volatility and other factors outside of our control. Note that it's a noncash item and is not strategically relevant to our core operating performance. Therefore, this adjustment is excluded from our non-GAAP net income and EPS going forward. We've also updated our historical periods to reflect this presentation for comparability. Fully diluted share count using the treasury stock method was approximately 506 million shares as of October 31, 2025. As part of our going public process, we recognized a large onetime stock-based compensation expense as the liquidity condition on outstanding restricted stock units was satisfied. This expense resulted in a GAAP net loss in Q3 of $453 million. Stock-based compensation, including related taxes for the quarter was $416 million, driven primarily by onetime expenses related to the vesting of RSUs in connection with our initial public offering. Going forward, we are focused on managing dilution. We anticipate that stock-based compensation expenses will decrease significantly in Q4 and for the most part, normalize thereafter. We generated $11 million in free cash flow, representing a 6% free cash flow margin. We're pleased with our ability to drive positive free cash flow as this demonstrates the leverage inherent in our model. While we continue to realize the benefits of being built to scale on margins and cash flow, our path to sustainable positive free cash flow is not expected to be linear. The timing of cash collections can vary, and we expect to continue investing in the business for long-term growth. We also surpassed $1 billion in remaining performance obligations, or RPO, reflecting 41% year-over-year growth. And finally, we ended the third quarter with $1.2 billion in cash, cash equivalents and marketable securities. This includes approximately $992 million in IPO proceeds, net of underwriting discounts and commissions. Before I share our guidance for the fourth quarter and fiscal year 2026, let me briefly outline some factors that should be considered. We plan to focus our investments on innovation as well as growth. This includes hiring engineers and data scientists in focused areas to drive Netskope's road map and innovation strategy. We'll also continue to focus on hiring and ramping reps to address growing market demand for our cloud security, networking, analytics and AI solutions. Also, we expect continued improvement in our gross margin as we work toward an 80% target over the long term. The foundational investments we made in building our NewEdge private cloud network allow us to scale efficiently going forward. Also, as a reminder, we are in the midst of a shift in our customers' billing terms. where our multiyear contracts are now primarily billed annually. In the past, a higher percentage were billed upfront. This shift is expected to increase the predictability of future cash flows. Note that this transition creates some near-term variability in cash conversion, free cash flow and calculated billings. And finally, we're encouraged by cloud modernization and AI tailwinds that favor Netskope. However, we're still early in our public company journey and also in an uncertain macroeconomic and geopolitical environment. We've built our guidance with these factors in mind. Let me now provide our guidance for Q4 and the full year fiscal 2026. As a reminder, these numbers are all non-GAAP, unless otherwise stated. For Q4 FY '26, we expect total revenue in the range of $188 million to $190 million, representing growth of approximately 27% at the midpoint, operating margin of negative 13% to negative 14%; net loss per share of $0.05 to $0.07 using approximately 400 million weighted average common shares outstanding. Please note, this excludes the change in fair value of the convertible notes I noted earlier. For the full year fiscal 2026, we expect total revenue in the range of $701 million to $703 million, representing growth of approximately 30% at the midpoint; gross margin of approximately 75%, operating margin of negative 16.5% to 17%, with investments focused on supporting our continued innovation and go-to-market expansion initiatives. Net loss per share of $0.51 to $0.53 using approximately 215 million weighted average common shares outstanding. Note, this also excludes the change in fair value of the convertible notes. Free cash flow in the range of $5 million to $8 million. In closing, we remain confident in our ability to execute on our long-term strategy and innovation, driving strong revenue growth and capturing market share. We remain focused on prioritizing disciplined execution, strategic investments that accelerate growth, strengthen our competitive advantage and continue to drive margin expansion and cash flow velocity while maintaining market leadership. Our innovation drives the flywheel for our growth, and as such, we'll continue to invest in our R&D engine and go-to-market while remaining fiercely committed to delivering profitable growth. Thank you for your time today. With that, I'll turn it over to the operator for Q&A.

[Operator Instructions] Our first question comes from the line of Meta Marshall with Morgan Stanley.

Congrats so much on a great first quarter out of the gate. Sanjay, maybe a question for you. Just as you're seeing kind of increased attach of additional modules, are there any trends in the modules in which you're seeing traction with? And how does that change how you think about product road map?

Yes. Great. Great question. If you look at the use cases, and I always come back to use cases, one of the top use cases for us is securing cloud and web access. Securing AI in the past 6 months has been a big one. That has drove and continues to drive our next-gen swing and our premium version of that. In addition, the consolidation for remote users and contractors has really driven our ZTNA offering. And the last one I would say is, especially with generative AI, data protection becomes even more important. People want to use and unleash AI, but they need to protect their data. And our unified data protection products, all the way from the endpoint to our in-line capabilities to our DSPM offering have also seen great growth.

Our next question comes from the line of Brian Essex with JPMorgan.

Drew, Sanjay, congrats on your first public quarter. Drew, I caught your comments on sales productivity. I was wondering if you can unpack that a little bit. I think pre-IPO, you accelerated hiring of quota-bearing reps and about half of those were still unramped. Could you help us maybe give us an update in terms of where you are in that ramping process? What percentage of reps might be now in that mature category? And how aggressively might you be hiring as you kind of like enter the end of the year?

From a rep perspective, we're on track for hiring. When you look at -- you can go to our website, and you will see just a slew of open racks for sales teams. And so we continue to accelerate hiring globally. We're getting some of the best reps you'll find out there. I just came from one of our new hire trainings, a room full of amazing reps, hunters. And so this is really the place to be if any reps are listening, and we want to come to a great place with an over 80% conversion rate on POC, please come here. But -- so we're on track and our ramp time frames are the same, usually around 9 to 12 months.

Our next question comes from the line of Matt Hedberg with RBC.

Great. I'll offer my congrats as well. Sanjay, for you, obviously, agents and agentic technologies on everybody's mind. And it feels like you guys are well positioned to help customers think through their agentic journey. Just kind of curious on how you think of that piece as part of the growth story here?

Yes. Great. It's a great question. I recently did a tour kind of across the world with customers' prospects and agentic AI, agentic workflows, securing enabling AI, top topic. If you look at where we're positioned, we see the traffic of all of our customers. We see their human traffic, their nonhuman traffic. All their AI applications go through us. So they could be using ChatGPT, they could be using AI within a SASE app. An AI agent could be originating that. We see that. And because we understand the language of AI, APIs, we see it at a more granular level than anybody else. We see -- oh, they're using Gemini, a personal instance and they're about to say reformat this health care data. Well, guess what, Netskope can stop that, yet still allow them to use that AI. And so I call that the front door of AI. It's users, AI agents, applications using LLMs and using AI. We see it, we understand it, we can protect that data and then we can put guardrails around it. And so absolutely right in our wheelhouse, and it's a big reason that we're seeing sort of the success across different verticals that we are.

Our next question comes from the line of Shaul Eyal with TD Cowen.

Sanjay, Drew, Michelle, congrats on the first quarter as a public company. Thanks for the data on module growth during the quarter. I think it's a great practice. Also, great job on deals over $100,000. Any color you can share with us on 7-digit transactions during the quarter? And are there any 8-digit deals in the pipeline?

Yes, it's a great question. So I think we highlighted a couple of great wins. We mentioned, for example, a Fortune 50 global pharmaceutical retailer, 50,000 employees using us for AI, cloud, SaaS, generative AI. We talked about another one where a financial institution needed to modernize and they consolidated multiple products from network to gateway to on-prem clients and so on. Those type of multiproduct where you can see now over half of our customers have 4 products, now we have 20. Those kind of multiproduct convergence where you're looking at what I call enterprise customers, right, well over 20,000, 10,000 users. Those have really been great wins for us. And the beautiful thing is the greenfield opportunity is, hey, we have 20 products. The average customer has just over 4. Our pipeline, we're not necessarily talking about specifics on that.

Can I -- I'm going to add one thing. Sanjay highlighted 2 of the larger deals that we're landing. Also remember, we have a lot of white space on the expansion side. So one of the expansion deals that he highlighted also was a very large deal.

Our next question comes from the line of Brad Zelnick with Deutsche Bank.

Excellent. And I echo my congrats as well. Drew, any help that you can offer in how we should think about ARR and net new ARR seasonality into Q4 and anything we might contemplate maybe even into next year? And I appreciate your comments about all the assumptions in your guidance, but also as a brand-new public company, I mean, you guys are growing in excess of 30% at real scale. I mean, it really stands out, really great. But anything you can do to help calibrate the kind of beats that we might expect going forward would be helpful.

Okay. Well, I think there's a couple of questions there. I think your first question really was on ARR, Brad. So we're not guiding ARR, but I do think it's helpful. We may want to just help you a little bit from a modeling perspective. If you look over really the last year, you could see that ARR was growing about 1 point faster than revenue. So just one way to kind of think about how to think about that. And then also last Q4 was very strong. It's a very strong quarter for us. So what I would consider a high bar. And Q3, also a very strong quarter. We just saw 34 -- ARR accelerating to 34%. In terms of just the guidance, again, newly public company, we are being prudent. And we also -- what Sanjay was just talking about, we have a lot of reps ramping. We continue to hire, and it's very hard to predict the rate at which we'll hire and the rate at which they'll ramp.

Our next question comes from the line of Rob Owens with Piper Sandler.

Hope to focus a little bit just around new customer acquisition and what you guys are seeing, both from a size of new lands and how that's comparing as well as are these greenfield lands or are you seeing replacement of existing technologies in terms of older SASE implementations?

Yes, it's great. Great question. When you look at lands, there's a percentage that is greenfield. You think about the use case, securing AI enabling AI. People don't really have anything for that. Those are greenfield use cases. You think about unifying data protection, that's greenfield. No one has anything really for identifying data in their data lake for [ RAG ], but maybe they have something on endpoint. And so there's a combo, data protection, greenfield and you're replacing endpoint, e-mail, in-line DLP systems. So greenfield, a mix. And then there's pure replacement. Legacy appliances dominate. You have first-generation cloud security providers. We mentioned one who the customer could not get implemented. And so there's also a lot of that where they want to take the next step in securing cloud and web and modernize their VPNs. And so that is replacement. So it is a spectrum, and we do see all of them. As far as just size, I think you had a question on landing. You can calculate kind of our -- from previously, our average ARR and beyond. And obviously, for us, it's always been around over $150,000 or so on, and it's $170,000 now. So it continues to grow and customers continue to land with more products and then they continue to expand with more.

Our next question comes from the line of Ittai Kidron with Oppenheimer.

Congrats, again, guys, on the first great successful quarter out of the gate. I wanted to focus on the Americas, Sanjay and Drew. I mean clearly, that's a region that you've been investing significantly in recently. I think, Drew, if I got this right, I think you mentioned Americas grew 34% year-over-year. Correct me if I'm wrong, but it didn't seem like the growth there was any materially different than the other regions. So I would love to see if you can get some color on your progression in the Americas? And how should we think about the growth pattern in that specific area?

Yes. So you have the right numbers. We mentioned that revenue in the Americas grew 34% in EMEA, same rate and APJ, just under 30%. And so for us, when you think about the Americas, specifically, last year, we obviously focused on taking the next step in our Americas team, right? We brought on some great leaders. We mentioned we brought on great leaders below our main leader and so on. And we've been in a big phase of just recruiting new reps. And as Drew mentioned, the focus is getting those reps ramped, getting them fully productive and so on. And so we see pretty consistent growth across all geographies, and that's great because that's great diversification for us.

Our next question comes from the line of Trevor Walsh with Citizens.

Interesting to hear about the Microsoft partnership, especially on the purview side and what you're doing around data security. Sanjay, I was wondering if you could just maybe weigh in a little bit on how you're thinking about maybe not just the Microsoft partnership, but more broadly with some of the -- with other large platforms and how you're balancing kind of the co-opetition piece there and as customers move towards consolidation kind of larger platforms, like how you're kind of balancing that module uptick that you're seeing with those -- where you choose to kind of do higher level integration?

Yes. So first of all, I've always believed that in security and networking, there is not one platform. Nobody wants one. I remember sitting in a room of 100 CIOs, and I asked them, where would you want to be on a spectrum of 100 to 1? Nobody wants 100, but nobody wants 1. And so the reality is they want a few, a few core platforms. and we're one of those. We consolidate 20-plus different things. It used to be called data network security, converged into one, right? But there are other platforms. There is your identity platform, your EDR, SecOps. And our philosophy is, look, we fight a common enemy and the industry needs to play well. It needs to integrate. It needs to have an open ecosystem. And so for us, that's what we focus on, right? We have integrations with pretty much every platform, security networking out there, and that includes Microsoft. We integrate with everything Microsoft has from endpoint to identity to SecOps. And so that announcement in that framework was just the next step, integrating with their Copilot, Purview and more. And our philosophy on that integration will continue.

Our next question comes from the line of Gregg Moskowitz with Mizuho.

Okay. Great. Congratulations on the terrific quarter. I don't want to overstate this, but a few investors have become a bit more concerned about a slowdown or a general slowdown in network security growth this year and other aspects of network security, I should say, and whether that could portend some sort of incremental pressure on SASE going forward. Based on the strong Q3, I'm sure you're not seeing any signs of this today, but it would still be helpful, Sanjay, just to get your perspective on this.

Yes. So I always say customers now, they don't want to throw more bad money after bad money. What's bad money in network security. Appliances, things that don't understand natively cloud, AI, things that were built to do web filtering, but not the world that people want now, which is not a [ louver ] block. And so in the broader spectrum of network security, we feed off that. We're good money. And so for us, the reason we see this acceleration in the TAM and the opportunity is people want to spend on things that move them forward in the cloud and AI world. And a lot of network security is not that. And so for us, why we don't concern ourselves with that stat or so on is we're the benefactor of that migration of that spend, right, to the right side of history, which is how do we enable cloud and AI. So SASE, one of the fastest-growing markets in security, I foresee for the next 10 years.

Our next question comes from the line of Eric Heath with KeyBanc.

Congrats on the strong start as well. Sanjay, I do want to come back to the comments on Microsoft. And if you can just expand a little bit more about the uniqueness of this Microsoft partnership relative to others in the industry. And then maybe, Drew, now that it's recently [ GA ], what this could mean to the model, if anything, as we look out into next year?

Yes. So when you look at the Microsoft partnership, we integrate with everything Microsoft has. And what we announced was -- and actually, what they announced was that they had chosen one SSE provider to go to market with. And the first one they decided was Netskope and they announced that at our conference earlier in the year. And that was what we partially announced in this announcement. The second was a lot of our customers came to us and said, "Wait a minute, you already secure all my cloud. You already secure all my web, you secure all my private apps. You understand AI and now you're going to secure that for me. We're using Microsoft Copilot. Well, guess what we can do with Copilot. We can watch everything they do in the Copilot conversations and make sure they're not conversing in the wrong way with sensitive data or make sure that there aren't threats. And so that multipronged partnership across the AI ecosystem of Microsoft, that's what our customers wanted, and that's kind of what we delivered. And so for us, when you look at organizations, mid- to large enterprises across the world, they want this independent layer, all AI, doesn't matter where it comes from. Anthropic, comes from Google, comes from Microsoft. doesn't matter what SASE app I use. It doesn't matter what website I go to. They want this independent layer that understands it and put guardrails on it. And so naturally, we're not going to go partner with 100,000 systems and app providers. We don't require the partnership. But the big ones, we both see great go-to-market and technical value of doing it. And Microsoft is obviously perhaps one of the biggest.

Yes, Eric. And then just on the second quarter -- the second question, excuse me. The way to think about it, it's just part of the overall modernization trend that's accounted for in the $149 billion TAM that we share. So obviously, we'll account for that when we do guide at the end of next quarter or next quarter's earnings call.

Our next question comes from the line of Shrenik Kothari with Baird.

Congrats on the strong start, Sanjay, Drew and team. I had a question on NewEdge, right? You have clearly invested in infrastructure full compute with the NewEdge POPs. And as LLMs, AI agents interact in real time, I would imagine latency, inline enforcement matter more and more. Do you see the edge itself as a big differentiator in customer conversation decisions and especially where potentially hyperscaler footprints are thin? And just how do you see your investment strategy going forward?

Yes. So the short answer is yes. NewEdge is a huge differentiator. I can't tell you how many conversations I go in, and the infrastructure operations person says, "Wait a minute, you're faster. I mean I can just see it. No matter where I am in the world, I use NewEdge, my end users see that their experience is faster." You think about that and you think about AI and you think about that, hey, over time, over half the transactions on the Internet won't be from humans. They'll be from AI agents. And that AI agent network, that highway, that's NewEdge. Because when you think about us, we're about 10 milliseconds from anybody in the world. And when you come to us, you don't go over the Internet to get to where are you going? You're going to Gemini, are you going to Anthropic, right? We're one of the most peered connected networks in the world. And so for us, just like AI is an accelerator for security, it is an accelerator for the advantage we have in our infrastructure and optimizing the end user or end agent experience.

Our next question comes from the line of Gray Powell with BTIG.

Yes, congratulations on the first quarter out of the box. It's great to see. So I just want to focus back in on some of the headline numbers. The acceleration in net new ARR really stood out this quarter and it's been impressive all year. And I know there's a number of factors that are driving that between sales and marketing investments and new products. Would it be possible to just sort of talk about what exactly is driving the improvement or maybe rank order what's driving that improvement? And then just how should we think about the sustainability of this improved productivity that you're seeing?

So from a net new perspective, we're a mix, right? We're hunters. So we're landing new logos, as you saw many, and we're expanding within our existing accounts, which you can see the growth of how many customers have 4 products, 6 and so on, right? This steadily increasing our NRR of 118. And so that net new ARR, it's a mix of both, net new logo and the prolific kind of upsell opportunity we have because the average customer is 4-plus and we have 20-plus modules. And so that's a mix. Now on the go-to-market side, as you know, one of our big focuses last year was making sure worldwide we had all the sales leaders that can take us for many, many, many years to the next stage. And we brought those on. And then we brought on reps and we started ramping them and so on. And so we feel good about our go-to-market execution worldwide. You can see that in the growth, for example, in the Americas. And so that's also another driver. The summary for you is if you think about Netskope, we win over 80% of the time if we get a spot at the table, we get a POC. So the Nirvana and the whole focus of our company is just broaden our awareness, right? And one of the reasons we went public broaden our awareness, right? When you write articles, that broadens our awareness. And so for us, a lot of that driver will also just be, hey, we're getting more at bats. We know that if we get in at bat, we have an amazing batting average. And so a lot of that also is just the go-to-market expansion, the awareness expansion that will come over time as well.

Yes. Great question, Greg. But if you go back over the last 18 months, 2 years, we put the leadership team in place. They've done a phenomenal job of building the go-to-market engine. And now it's really all about hiring reps. And we talked about that, the hiring there and the ramp time and that impact. And what you're seeing now as we invest more reps, 34% ARR growth, 44% net new ARR growth in the quarter. So we're seeing the results that we expected to see, and they're executing very well.

Ladies and gentlemen, I'm showing no further questions in the queue. I would now like to turn the call back over to Michelle for closing remarks.

Great. Thank you, Towanda. And with that, we conclude our third quarter fiscal 2026 earnings call. Thank you for joining us all today, and we look forward to engaging with you in the weeks and months ahead.

Ladies and gentlemen, that concludes today's conference call. Thank you for your participation. You may now disconnect.