Corrected Transcript 04-Mar-2020 Ping Identity Holding Corp. (PING) Q4 2019 Earnings Call Total Pages: 22 1-877-FACTSET www.callstreet.com Copyright © 2001-2020 FactSet CallStreet, LLC Ping Identity Holding Corp. (PING) Corrected Transcript Q4 2019 Earnings Call 04-Mar-2020 CORPORATE PARTICIPANTS Hugo J. Doetsch Raj Dani Vice President-Finance, Strategy & Corporate Development, Ping Chief Financial Officer, Ping Identity Holding Corp. Identity Holding Corp. Andre Durand Founder, Chief Executive Officer & Director, Ping Identity Holding Corp. ..................................................................................................................................................................................................................................................................... OTHER PARTICIPANTS Heather Bellini Tal Liani Analyst, Goldman Sachs & Co. LLC Analyst, BofA Securities, Inc. Saket Kalia Michael Turits Analyst, Barclays Capital, Inc. Analyst, Raymond James & Associates, Inc. Matthew Hedberg Jonathan Ho Analyst, RBC Capital Markets LLC Analyst, William Blair & Co. LLC Philip Winslow Gregg Moskowitz Analyst, Wells Fargo Securities LLC Analyst, Mizuho Securities USA LLC Brad Zelnick Shaul Eyal Analyst, Credit Suisse Securities (USA) LLC Analyst, Oppenheimer & Co., Inc. Drew Foster Gray Powell Analyst, Citigroup Global Markets, Inc. Analyst, BTIG LLC Gur Yehudah Talpaz Analyst, Stifel, Nicolaus & Co., Inc. 2 1-877-FACTSET www.callstreet.com Copyright © 2001-2020 FactSet CallStreet, LLC Ping Identity Holding Corp. (PING) Corrected Transcript Q4 2019 Earnings Call 04-Mar-2020 MANAGEMENT DISCUSSION SECTION Operator: Ladies and gentlemen, thank you for standing by and welcome to the Ping Identity Fourth Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. [Operator Instructions] Please be advised that today's conference is being recorded. I would now like to hand the conference over to your speaker today, Hugo Doetsch, Vice President of Finance, Strategy and Corporate Development. Thank you. Please go ahead. ..................................................................................................................................................................................................................................................................... Hugo J. Doetsch Vice President-Finance, Strategy & Corporate Development, Ping Identity Holding Corp. Thanks, everyone, for joining us today and welcome to the Ping Identity conference call where we will discuss our results for the fourth quarter of fiscal year 2019 and provide our initial outlook for fiscal year 2020. Before we begin, I would like to remind you that shortly after the market closed today, Ping Identify issued a press release announcing its fourth quarter and full year 2019 financial results. Additionally, Ping Identify published its supplemental slide presentation to accompany this call. You may access the press release and presentation on the Investor Relations section of pingidentity.com. With me today is Andre Durand, our CEO; and Raj Dani, our CFO. Today's discussion may include forward-looking statements. Please refer to our final initial public offering prospectus dated September 18, 2019 and filed with the Securities and Exchange Commission where you will see a discussion of factors that could cause the company's actual results to differ materially from these statements. I would also like to remind you that during the call we will discuss some non-GAAP measures related to Ping Identity's performance. You can find the reconciliation of those measures to the nearest comparable GAAP measures in our quarterly financial statements. Just one housekeeping item, to ensure we can address as many analysts' questions as possible during the call, we asked that you please limit your questions to one initial question and one follow-up. And with that, I'll turn the call over to Andre Durand, Founder and Chief Executive Officer of Ping Identity. Andre, please go ahead. ..................................................................................................................................................................................................................................................................... Andre Durand Founder, Chief Executive Officer & Director, Ping Identity Holding Corp. Thanks, Hugo. Good afternoon, everyone, and thank you for joining our second earnings call as a publicly traded company. Before I begin, I'd like to thank my team, our partners and our customers for their support and dedication to making the world a safer place through identity. And now, onto our Q4 results, we had a record fourth quarter highlighted by strong top line growth, profitability, continued success in the enterprise market, tremendous new customer wins, and further innovation across our platform. Annual recurring revenue grew 23% year-over-year, culminating in a total ARR of $224.9 million. Q4 revenue was $68.2 million. Given the continued impacts of ASC 606 to our GAAP revenue when we sell our hybrid identity platform, we believe that ARR provides an important representation and measure of our top line growth, and is 3 1-877-FACTSET www.callstreet.com Copyright © 2001-2020 FactSet CallStreet, LLC Ping Identity Holding Corp. (PING) Corrected Transcript Q4 2019 Earnings Call 04-Mar-2020 the key metric we use to evaluate the business. Since this is only our second earnings call and a number of today's participants are relatively new to the Ping story, I will briefly review our offering and the prevailing market drivers. Ping's Intelligent Identity platform helps enterprises manage their customer, workforce and partner identities, while enabling the seamless access of applications and resources across the most complex hybrid IT enterprise infrastructures. With the rising importance of identity, one Fortune 100 customer recently cited Ping as the heartbeat of the company. And another told me we are now one of the most important infrastructures in the company, protecting tens of millions of users and several hundred mission critical applications. As a result of identity's rising importance, Ping's relationship with the C-suite is growing. And we are often called upon to meet with CIOs because our partnership is viewed as strategic to their digital transformation efforts. This rising tide of identity bodes well for the future of the Ping platform which is comprised of six solutions for enabling mission critical identity security functions such as multi-factor authentication, single sign-on, access security, directory, identity data governance, and API security. Each solution is built upon open standards and can be deployed stand-alone or in conjunction with other Ping solutions in our cloud, the customers' cloud or in their data center. Taken as a whole, the Ping platform provides a powerful foundation for the digital transformation of customer engagement and workforce security. Our platform is differentiated through intelligence, deployment flexibility, turnkey integrations with hundreds of hybrid cloud environments, and an ability to address all primary identity use cases with one platform. As a result, enterprises are able to provide an enhanced user experience and increased security to their customers, employees and partners. A common theme among many of our enterprise customers is that identity in the Ping platform are absolutely mission critical. We frequently hear from our customers that planes won't fly, surgeries won't happen and money won't move if the Ping platform does not perform to the highest standards of security and resiliency. Even many of today's first responders rely on Ping's technology day in and day out to ensure public safety. The approximate $25 billion market we serve can be broken down into two large opportunities. The first is a replacement of legacy identity solutions that have reached their end of life and are inhibiting the adoption of cloud, mobile, and API first architectures. The second opportunity is greenfield expansion driven by the adoption of new technologies such as multi-factor authentication, API security, and a growing demand for our customer identity solutions. We've chosen to direct our solutions at the enterprise market with a need for control, security, performance, scale, integration and advanced capabilities match our platform's strengths and our DNA as a company. We solve the most mission critical requirements for our enterprise customers. These enterprises require solutions that cannot only secure hybrid infrastructures. They require a solution that can be deployed wherever the enterprise requires; cloud, private cloud, hybrid, or on-premise based upon the needs for control, security, and compliance. Increasingly, we've invested in DevOps and containerization technologies to enable the rapid deployment of the Ping platform in the customer's cloud of choice. Ping is an industry leader in offering this hybrid cloud deployment flexibility, and the ability to secure the enterprise end-to-end. Many of our larger and more regulated customers choose to deploy Ping within their data center for maximum security. Customers undergoing a cloud transformation, but requiring the same level of control they have within their data center choose to deploy Ping in their cloud. Others choose to leverage our Identity-as-a-Service for rapid deployment when the need for