Progress Software Corp

NASDAQ:PRGS

Earnings Call Transcript 2020-Q4

[Operator]

Good day, everyone, and welcome to today's Progress Software Corporation's Quarter Four 2020 Investor Relations Call.

At this time, I'd like to turn the floor over to Mr. Anthony Folger, Chief Financial Officer. Please go ahead, sir.

[Anthony Folger, CFO]

Thank you, Greg. Good afternoon, everyone, and thanks for joining us for Progress Software's fiscal fourth quarter 2020 financial results conference call. With me today, is Yogesh Gupta, President and Chief Executive Officer.

Before we get started, I'd like to remind you that during this call, we will discuss our outlook for future financial and operating performance. Corporate strategies, product plans, cost initiatives, our integration of Chef, the impact of the COVID-19 crisis on our business, and other information that might be considered forward-looking.

This forward-looking information represents Progress Softwares' outlook and guidance only as of today, and is subject to risks and uncertainties. For a description of the risk factors that may affect our results, please refer to our recent SEC filings, in particular, the section captioned Risk Factors in our most recent Form 10-Q Progress Software assumes no obligation to update the forward-looking statements included in this call, whether as a result of new developments or otherwise.

Additionally, on this call, all the financial figures we discuss are non-GAAP measures unless otherwise indicated. You can find a reconciliation of these non-GAAP financial measures to the most directly comparable GAAP numbers in our financial results press release, which was issued after the market closed today and is also published on our website. This document contains the full details of our financial results for the fiscal fourth quarter of 2020, and I recommend you reference it for specific details.

We have also published a presentation that contains supplemental data for our fourth quarter 2020 results, providing highlights and additional financial metrics. Both our earnings release and this presentation are available in the Investor Relation section of our website, at investors.progress.com. Today's conference all will be recorded in its entirety and will be available via replay from the Investor Relations section of our website.

With that, I'll now turn it over to Yogesh

[Yogesh Gupta, President and CEO]

Thank you, Anthony, and good afternoon, everyone.

As I'm sure you've all seen in today's press release, we finished the year on a very positive note with the revenue and EPS, both above our expectations. We also delivered strong year-over-year revenue and EPS growth for both Q4 and FY '20.

Overall, I'm thrilled with our results, both for the fourth quarter and the full year 2020. These results reflect the durability of our business and our success in executing our total growth strategy.

While the uncertainties and disruptions of the COVID-19 pandemic impacted the timing of our effort - sorry, impacted the timing of our efforts to close new business and upsell existing customers, we believe our strong execution and relentless commitment to ensuring customer success by delivering high-quality product offerings and support enabled us to excel in 2020. This focus on customer success also helped us maintain our industry-leading customer retention rates.

I'm also extremely pleased with the progress we are making in executing our total growth strategy. Our 2019 acquisition of Ipswitch has proven to be successful, both financially and operationally, and we remain bullish about our acquisition of Chef who is a pioneer in DevOps and DevSecOps, and extends our longstanding leadership position in the developer ecosystem. More on Chef in a few minutes.

Anthony will provide more details during his comments, but the revenue upside in the quarter came primarily from better than expected OpenEdge and DataDirect software license revenue, coupled with our consistently high customer retention rates.

In addition, Chef contributed to our results for roughly two months in the fourth quarter, and Chef's contribution was right in line with our expectations. For the full year, recurring revenue contribution continued to grow in 2020 and reached 80% driven by strong net retention rates.

As always, our employees' commitment to the success of our customers and partners remains the key factor in driving Progress's performance and we are grateful for their contributions. Our teams continued to work remotely.

And while we're optimistic about the rollout of the COVID-19 vaccine globally, we are confident that we can continue to execute on our strategy, accomplish our financial objectives and provide the high-quality support our customers are accustomed to whether we are in the office or working remotely.

As you know, one of our areas of focus in the fourth quarter was the integration of Chef, which we acquired in early October. I have been thrilled by the response from Chef customers to the acquisition. Chef has an impressive array of Fortune 500 and key enterprise customers who have come to rely on Chef products for their multi-cloud and hybrid cloud DevOps needs.

We've engaged with many of these customers since the acquisition closed, and we are pleased that Chef is now part of Progress, a larger and financially much stronger organization with the commitment to continue Chef's legacy of delivering high-quality products and support, as well as to Chef's vibrant open source community.

We're also extremely pleased with the progress to date of the integration of Chef into our business. The integration is on track and going well with key elements already complete. Although we still have much work to do in FY '21 to complete the integration, I am now more confident that we will meet our objectives.

With the continuing support and enthusiasm of Chef's customers, Chef operational and financial performance during Q4 was in line with our expectations. As we look forward to 2021, we are positioned to meet and potentially exceed the financial targets that we set for Chef back in September when we announced the acquisition.

I'd now like to spend a few minutes on our growth strategy in general. As we have embarked on our total growth strategy through accretive M&A, we have bolstered our internal capabilities by making key investments, including in our M&A capabilities. These investments have yielded and will continue to yield great benefit, both in sourcing and executing opportunities and integrating acquisitions more quickly.

As a result, our M&A capabilities combined with the large fragmented and growing DevOps market opportunity, position us well to execute on our total growth strategy, enabling us to deliver sustained shareholder value for years to come.

The DevOps market is not new to Progress. As I've said many times, Progress has over the last 40 years been a leader in the application development market, and we have been central to the success of developers and IT professionals throughout that time.

The longevity of OpenEdge and the ongoing value devised by our OpenEdge customers is a testament to that, and it's not limited to just OpenEdge. The same is true across our entire product portfolio and customer base.

Our combination with Ipswitch almost two years ago added strong capabilities around IT operations. The addition of Chef provides a real strength in automated deployment with a strong emphasis on security and compliance.

So while our use of the term DevOps and DevSecOps is relatively new, these markets are not new to us, as we have a long history of delivering products to developers and IT professionals that enable them to develop, deploy and manage high impact business applications.

It's worth spending a few moments talking about the DevOps market. Industry analysts forecast that the DevOps market will go from a little over $4 billion revenue in 2019 to nearly $15 billion in 2026, a CAGR of 19. And while a large and growing market is important, we believe this market is also relatively fragmented and presents an opportunity for our total growth strategy.

To provide a sense of the M&A opportunity for Progress, it's important to consider the broader infrastructure software market, which includes the DevOps market. During the five year period from 2014 to 2018, venture capitalists invested over $100 billion in nearly 16,000 companies in the infrastructure software market, and this fanatic pace continues to increase.

In addition to venture investment, group equity investors have been active. Some foundry owned businesses have grown to scale and many larger tech companies are looking to divest assets that no longer fit their strategies. As a result, we believe the M&A opportunities in our market will fuel our strategy for many years ahead.

Looking ahead to 2021, we continue to execute on the plan that resulted in our success in 2020, namely our total growth strategy, driven by the expansion of our business through accretive acquisitions and a relentless focus on customer retention. Our focused M&A efforts will continue to strengthen our already solid position in the DevOps and DevSecOps markets.

At the same time, we'll continue to deliver superior value to our customers in the form of high-quality products, excellent customer support, and a lower total cost of ownership, enabling us to maintain our impressively strong customer retention rates.

Operationally, we remain focused on operating our business efficiently, allowing us to generate best-in-class operating margins. We're confident that our total growth strategy in combination with this operating philosophy will provide substantial and sustainable value to all of our stakeholders.

In summary, we are very pleased with our 2020 performance, especially considering the uncertainties we faced early in the year. We continue to demonstrate the durability inherent in our business and are confident in our ability to continue advancing our strategy in 2021.

With that, I'd like to turn the call over to Anthony to provide more details on our financial results and our outlook. Anthony?

[Anthony Folger, CFO]

Thanks Yogesh. Good afternoon, everyone, and thanks for joining our call.

As I'm sure you heard in Yogesh's remarks, we're very pleased with our results in the fourth quarter with revenue, operating margin, EPS and free cash flow, all surpassing our expectations. We're also delighted with the acquisition of Chef and how the integration has progressed to date.

Turning to the numbers. Our revenue for the quarter of $129.1 million represents 5% growth over the prior-year quarter and reflects stronger than anticipated sales of our OpenEdge and DCI products.

Despite closing the Chef acquisition five days later than anticipated, we were still able to deliver these very strong results on the top line, and our operating discipline through the COVID-19 pandemic resulted in continued margin expansion, a trend that we experienced throughout 2020.

For the full-year, revenue of $456.2 million represents 6% growth compared to fiscal 2019. That growth largely driven by a full-year revenue contribution from Ipswitch and a two-month revenue contribution from Chef. With customer retention rates remained consistently strong throughout the year, we're very pleased with our top line results and believe our business showed tremendous resiliency in fiscal 2020.

Turning to expenses. Total cost and operating expenses were $81 million for the quarter, up 6% over the year-ago quarter and $273.5 million for the full year, up 1% compared to fiscal 2019. For the quarter, the increase in cost and operating expenses was driven by the acquisition of Chef and partially offset by a reduction in cost and operating expenses across the rest of our business, largely driven by measures we've put in place to combat the spread of COVID-19.

For the full year, the increase in cost and operating expenses reflected a full year of activity for Ipswitch and two months of activity for Chef, partially offset by cost management measures put in place in the fourth quarter of 2019 in our cognitive business, coupled with the same COVID-related reductions in cost and operating expenses that I previously mentioned.

Operating income for the quarter was $48.1 million, and operating margin of 37% compared to $47.3 million in the year-ago quarter. For the full year, operating income was $182.8 million for an operating margin of 40%, an increase of $20.5 million or more than 200 basis points compared to fiscal 2019. We recognize that a portion of the margin improvement achieved in fiscal 2020 is the result of better than expected performance during the year.

However, our perspective on sustainable operating margins is unchanged in the high-30s. The reason for this is because a portion of the fiscal 2020 margin improvement was driven by reduced expenses resulting from the restrictions we put in place to combat the spread of COVID-19.

In addition, it's worth highlighting that our integration of Chef and the recognition of related cost synergies will take place gradually over the course of 2021 likely resulting in higher operating margins later in the year.

Earnings per share were $0.91 for the quarter, an improvement of $0.12 or 15% compared to the year-ago quarter. For the full-year, earnings per share were $3.09, an improvement of $0.40 or 15% compared to fiscal 2019.

Moving onto a few balance sheet and cash flow items. We ended the quarter with $106 million in cash, cash equivalents and short-term investments, and a debt balance of $384.5 million, which is comprised of our term loan in the amount of $286 million and $98.5 million under our revolving line of credit, which we drew down to partially fund the Chef acquisition

DSO for the quarter was 54 days compared to 56 days in the fiscal fourth quarter of 2019. Deferred revenue was $193 million at the end of the fourth quarter, up almost $16 million from a year ago, reflecting the addition of Chef's deferred revenue after purchase accounting adjustments.

Adjusted free cash flow was $40.7 million for the quarter, up 11% compared to the year-ago quarter. And during the quarter, we repurchased $40 million of Progress stock. As a result, at the end of Q4, we had $190 million remaining under our current share repurchase authorization.

Now, I'd like to turn it to our outlook for Q1 and the full year 2021. Our expectations for Chef and Chef's contribution in 2021 have remained largely unchanged, in that we anticipate Chef's business to grow low single digits as we focus our efforts on customer retention.

And as previously mentioned, we expect the integration of Chef to continue throughout 2021. As a result, we expect to recognize cost synergies gradually throughout the year and to exit the year with an operating margin contribution from Chef of at least 35%

In addition to Chefs contribution, when developing our outlook, we assumed that some of the headwinds resulting from the economic challenges brought on by the COVID-19 pandemic will continue for at least a portion of 2021, and that our top line excluding Chef's contribution would be roughly flat for the year. We've also assumed that our operating expenses related to travel, facilities and related activities will be lower during the first half of 2021 due to the continuing COVID-19 restrictions.

Our outlook for 2021 also reflects a lumpy quarterly distribution of revenue for our DataDirect product line. As a reminder, DataDirect is the only product in our DCI segment. For the full year, we expect the product line to remain largely flat, and consistent with our prior statements, we believe the annual contract value will remain in the range of $32 million to $33 million.

However, as it relates to the quarterly distribution of revenue, we expect Q1 revenue for the DataDirect product to decline by almost $9 million when compared to Q1 of 2020, and we expect to see a corresponding increase in the second half of the year, most likely in Q4.

The overall impact on the year is obviously not meaningful. However, it's important to highlight how the expected renewal dates for multi-year OEM contracts impacts the quarterly distribution of revenue in 2021.

I'd also like to point out that Chef's subscription license model is similar to that of DataDirect. As a result, in 2021, we will aim to enhance our disclosure to ensure it better reflects the underlying performance of our business, including the addition of Chef.

With that, for the first quarter of 2021, we expect revenue between $119 million and $123 million. This includes a full-quarter contribution from Chef, partially offset by the almost $9 million reduction in DataDirect revenue as previously discussed.

We also expect earnings per share of between $0.72 and $0.76. For the full year 2021, we expect revenue of between $513 million and $521 million, representing 12% to 14% growth over fiscal 2020. Substantially, all of this revenue growth reflects the full-year contribution from Chef.

We anticipate an operating margin for the year of approximately 37%, with a slight headwind from the Chef acquisition, which will improve through the course of the year, as I previously outlined. We're projecting adjusted free cash flow of between $150 million and $155 million, and we expect earnings per share to be between $3.22 and $3.28.

When comparing our EPS guidance to 2020 results, it's important to note that we've included a $0.02 increase for the anticipated impact of foreign exchange on a year-over-year basis. Our guidance for full-year EPS assumes a tax rate of 20% and approximately 44.5 million shares outstanding.

In closing, I'd like to reiterate that we're thrilled with our Q4 performance, the acquisition of Chef, and our outlook for 2021. We believe the investments we've made in our M&A capabilities position us well to execute our total growth strategy and create real value for our shareholders.

With that, Greg, I'd like to open the call up for Q&A.

[Operator]

[Operator Instructions] And first, we're going to hear from Dan Ives with Wedbush Securities.

[Strecker Backer, Wedbush Securities]

This is Strecker on for Dan. In the integration process so far with Chef, can you just talk about maybe what is surprised you the most over the past three months? And then a follow-up. As we look into fiscal year '21 with Chef and your guidance, what do you see is the biggest challenges for the team versus some of the low-hanging fruits out there? Thank you.

[Yogesh Gupta, President and CEO]

This is Yogesh. The most impressive thing for me has been how wonderful the customers are. I mean, we have amazing customers with Chef, and they are truly excited about the fact that Progress acquired Chef, that Progress is now - and the Chef product, therefore, is now part of a much stronger company with a much stronger global presence, and that we are truly committed to delivering on the product roadmaps on the future for the - enhancements for the products on making sure that the customers are successful, as well as our strong commitment to the open-source community that Chef had.

So the fact that we're continuing the strategy that you have had, but now with a stronger business behind it, I think is really the most exciting thing for me. And it has been truly amazing to see how excited our customers are - the Chef customers about this acquisition.

So that would be sort of a big positive that we take away. And in terms of the next year, we are confident with respect to where we see the business going. We expect to continue our integration which has started off really well.

As I mentioned, we've actually completed some of the activities already, but there is more to be done in 2020 - sorry, 2021, and continued to execute on those, making sure that we continue to get the synergies over time that we expect and exit the year at the right level of synergies from Chef, I think that will be an important thing for us to do, continue to make sure that we - on our overall product portfolio, not just with Chef, but everything that we have, continued to focus on retention rates, customer satisfaction, and along the way also win new customers and expand from existing customers. But really - so it's just - I think it is really more of the same, Strecker. I don't think there is anything unusual next year that we foresee at this point.

Anthony, do you want to add anything to that?

[Anthony Folger, CFO]

No, Yogesh. I think that covers it. Yes.

[Yogesh Gupta, President and CEO]

Okay.

[Operator]

Next, then we'll hear from Mark Schappel with Benchmark. Mr. Schappel, excuse me sir if I pronounced it wrong.

[Mark Schappel, Benchmark]

Yogesh, starting with - hey, good Yogesh - good to hear from you. If I recall correctly, Yogesh, last year, I think you're stating you're looking at close to 200 companies a year from an M&A perspective. And given your enhanced M&A team now, would you say you're looking at a similar rate of companies or even more from that now?

[Yogesh Gupta, President and CEO]

So I think that in some ways, the number of companies has gone up a little bit, but I think the other part really, Mark, I think we are doing a better job of honing and filtering and making sure we're looking at that right once more. I think that quality also matters, as I'm sure you can imagine. So, no, I think we feel really confident about our ability to go out and identify assets, and continue to execute on our total growth strategy.

It's an interesting thing. We've built a strong team, not just on finding and sourcing these M&A deals and executing on them and making the deals happen, but also on integration and then systems and other aspects of our business over the last year. So those investments, I think are - we are seeing some of the fruits of that with our Chef integration that is ongoing, and I think we will also get better on that front as well. So I think it's both sides. I - actually, I'm truly excited about the opportunity ahead.

[Mark Schappel, Benchmark]

And could you remind us of the size of the companies that you're - that are in your target zone?

[Yogesh Gupta, President and CEO]

Yes. So in general, we look for - I think we've said before, the 10% to 20% revenue range is sort of the ideal one, but we will look at something smaller if it makes sense and something bigger if it makes sense, right. Sometimes it depends on the asset that comes up.

So the sweet spot for us has been sort of the $40 million to $100 million revenue business. But if something came along that was $20 million that we feel was the right fit and the right type of company with the right retention rates, I think, you know, to us that would be very attractive or if it was even over $100 million.

So, Mark, I - we feel that at this point, the team is ready to do deals at a faster pace than we did over the last two years, and continue to integrate them. So - and so the range is still - the sweet spot range is still 10% to 20% approximately of our revenue.

[Mark Schappel, Benchmark]

And then in your prepared remarks, you had mentioned integration is another goal, but in your prepared remarks, you stated that the key elements of the Chef integration already complete. I was wondering if you could just fill in a few more details on what those key elements are?

[Yogesh Gupta, President and CEO]

Yes. So some of the key elements that are complete, I don't want to imply all key elements at that, so please, - if I said that, I misspoke. Some of the key elements are already in place. And then to give you an example, right? We closed the first month's books with - on our financial systems, the people moved into our HR systems and we used Workday for that, so all the employees are in our Workday system.

Everybody on day one had their email set up and they were on our domain and had logins. And it really on the systems side and on the integration of the financial processes and all that has been very rapid and remarkably good and smooth.

We also continue to - as it happens, Chef was using Salesforce for their sales automation and so do we on the CRM side, so we're bringing those together and so on. So I think to us, the key getting out of the gate, we were able to do that and to integrate those systems really well, bring people on board really well, put the functionals where they belong within the Company on day one, so that the people knew exactly which organization they were part of on the very first day that they joined.

To me, all these things, all right, and then be able to start interacting with customers on day one. So the person who is leading this business for us, Sundar, who reports to me, and he has personally spoken with nearly 50 customers, right, 50 enterprise customers and the team has spoken to many more than that. And so it's - all those things have gone really well, and that's what exciting about it, Mark.

[Mark Schappel, Benchmark]

And Anthony, did you state the Chef contribution in your prepared remarks in the quarter?

[Anthony Folger, CFO]

For the quarter, I did not Mark, but it was - on a non-GAAP basis, it was just over $9 million in revenue.

[Operator]

And then moving on from Sidoti, we have Anja Soderstrom.

[Anja Soderstrom, Sidoti]

Hi, Yogesh and Anthony. Thank you for taking my question, and congratulations on the nice results.

[Yogesh Gupta, President and CEO]

Thank you, Anja.

[Anja Soderstrom, Sidoti]

I hope you're off to a good start. And - so I just have some follow-ups on the Chef and the acquisition, and M&A. So first, I'm just curious how many did Chef employ, and was there any churn when you took them on?

[Yogesh Gupta, President and CEO]

Sure. Yes. So Chef employed over 200 people, actually, close to almost 250 people when we brought them on board. But we, of course, from a perspective of - as you know, to drive synergies and so on, we brought a slightly smaller number on board, and we have basically continued to work with the team.

Obviously, Anja, when you have a company that was a start-up, that was looking to grow rapidly and have a culture of working in a start-up and looking to be an IPO and so on. When there is an exit like this, there are some employees who kind of want to go and work at another start-up.

So we've had some turnover like that. But it's all very much as we've expected, and we really find that to us, what has been key is that we continue to execute on our product roadmaps, we delivered new releases of the product in the fourth quarter, we continued to support customers and meet their needs and requirements, and that has continued to go really well.

So - and obviously, on the financial side, the business has - as Anthony said in his prepared remarks that despite being five days into the second month of the quarter, so we got a little bit less than two months of contribution, we were still able to get the contribution on the top line that we expected for - from Chef. So business has been good and really any employee turnover that has happened hasn't really impacted our business in any way, shape or form.

[Anja Soderstrom, Sidoti]

And I think you mentioned - you said when you acquired Chef that you expected to be accretive in the first quarter. Do you still think that or?

[Yogesh Gupta, President and CEO]

Anthony, I don't - perhaps, can you speak to that?

[Anthony Folger, CFO]

Yes. I think our view, Anja, was that in the - as we entered fiscal '21, so the first quarter of '21, we would start to see accretion from Chef, and we still expect that. So our expectations are still in line. We expected that for Q4 because Chef was just sort of a breakeven business when we acquired it, it may not be accretive in the two-month period. But certainly, as the calendar turns and we get into Q1 of fiscal '21, we did say, we expect it to be accretive and we still do.

[Anja Soderstrom, Sidoti]

And then since you had such a successful integration with Ipswitch and sort of created playbook there. Do you see yourself being able to use that playbook for Chef there and the other sort of learnings from Chef and - or hiccup so or whatnot?

[Yogesh Gupta, President and CEO]

Yes. You know, - I mean, absolutely, yes, right? I mean, you know, we are using that playbook, but we'll continue to the playbook, right? Every single time when we will do an acquisition, we'll probably learn something additional that adds to that playbook. But yes, the playbook is - we have used the playbook. We used it do M&A due diligence. We used it post diligence for integration. And we will continue to refine it and add to it as we do additional acquisitions.

So each acquisition has some subtle differences, and we need to make sure that whatever learnings we have, we add to that. So I'm actually very confident of and comfortable with where the playbook is today, and that I can - we can execute other M&A deals and apply that playbook to that.

[Anja Soderstrom, Sidoti]

And sort of what are you seeing in the M&A market? Has that changed in the last couple of months, and how has it changed, if at all?

[Yogesh Gupta, President and CEO]

We have not seen any kind of a significant change in the last couple of months, to be honest, Anja. It's a - I think it is a constant flow of deals. You know, we are - we are seeing a very, very robust set of deal flow, and as I said earlier, we are getting better and I think we've gotten significantly better in terms of making sure that they are the right type of targets and they continue to be so. So yes, I'm actually very confident that the deal flow is not an issue.

[Anja Soderstrom, Sidoti]

And how soon do you think you would be able to take on another acquisition given you're still digesting Chef?

[Yogesh Gupta, President and CEO]

So from an ability to take on, we are comfortable taking on another deal now, right? So it's not - we are not slowing things down. We're not saying, let's stop and pause. We feel very confident that where the right opportunity show up, we'll be able to execute on our next one.

So after Ipswitch, as you know, we decided to pause for about six months, but we have not paused at all since Chef.

[Anja Soderstrom, Sidoti]

And just to switch gears, did you see any sort of impact on your business when the - when sort of the SolarWinds cyberattacks happened?

[Yogesh Gupta, President and CEO]

We have not seen really any significant impact. We are seeing some interest in WhatsUp Gold, which is our network management product in the market, and folks are asking and wondering whether they ought to switch from SolarWinds to our product.

But it's really sort of low level of activity, so it's rather small and muted. So no meaningful business impact in terms of suddenly a whole bunch of SolarWinds' customers showing up at our doorstep. So - but from our perspective, we continue to execute on our go-to-market efforts, and as I said, SolarWinds is not really creating any additional meaningful opportunity.

[Anja Soderstrom, Sidoti]

And then the last one. So is there anything, you know, that's still challenging for you that you see you might be a tailwind post-COVID?

[Yogesh Gupta, President and CEO]

Well, I think that you know, we are still not done with COVID, even though we are all very hopeful, and I'm really excited about the vaccine and the possibility of it being available globally, very rapidly, including places like Europe and India, where we have a larger employee population. I think to me, post-COVID, I don't think there are additional other challenges. I mean it's normal operational things that we have to continue to do, and we will continue to do them.

So nothing unusual. We do take - see that the COVID having, as Anthony said, some impact and some headwinds in the first half of the year, as we get back closer to normal. But beyond that, I don't really see any additional significant challenges.

[Operator]

All right. And following Anja, it looks like there is no further questions at this time. I'd like to turn the floor back over to Yogesh Gupta for any additional or closing remarks.

[Yogesh Gupta, President and CEO]

Thank you, Greg. And thank you, all for joining our call today. We are truly excited about our performance in 2020. Our integration of Chef is well on track, and as we continue to execute on our total growth strategy in FY '21, we will further strengthen our position in the DevOps and DevSecOps markets. And we look forward to talking to you soon. Thanks again, and stay healthy and safe. Bye-bye.

[Operator]

And once again, ladies and gentlemen, that concludes our call for today. We do appreciate your joining us. You may now disconnect.