Asana Q1 2026 Earnings Report

Asana EPS Results

• Actual EPS: $0.05
• Consensus EPS: $0.02
• Beat/Miss: Beat by +$0.03
• One Year Ago EPS: -$0.06

Asana Revenue Results

• Actual Revenue: $187.63 million
• Expected Revenue: $185.40 million
• Beat/Miss: Beat by +$2.23 million
• YoY Revenue Growth: +8.60%

Asana Announcement Details

• Quarter: Q1 2026
• Date: 6/3/2025
• Time: After Market Closes
• Conference Call Date: Tuesday, June 3, 2025
• Conference Call Time: 4:30PM ET

Asana (NYSE:ASAN), together with its subsidiaries, operates a work management platform for individuals, team leads, and executives in the United States and internationally. Its platform helps organizations to orchestrate work from daily tasks to cross-functional strategic initiatives; manage work across a portfolio of projects or workflows, see progress against goals, identify bottlenecks, resource constraints, and milestones; and communicate company-wide goals, monitor status, and oversee work across projects and portfolios to gain real-time insights. The company serves customers in various industries, such as technology, retail, education, non-profit, government, healthcare, hospitality, media, manufacturing, professional services, and financial services. The company was formerly known as Smiley Abstractions, Inc. and changed its name to Asana, Inc. in July 2009. Asana, Inc. was incorporated in 2008 and is headquartered in San Francisco, California.

Asana Q1 2026 Earnings Call Transcript

Key Takeaways

• Achieved first-ever non-GAAP profitability in Q1 with a 4% operating income margin and 9% year-over-year revenue growth, representing a 1,300 basis-point improvement in operating margins.
• AI Studio reached general availability and surpassed $1 million in ARR during the quarter, fueling a rapidly growing global pipeline and early adoption across diverse industries.
• Secured a landmark $100 million-plus, three-year contract renewal—Asana’s largest deal to date—validating enterprise scale, though it carries a modest ACV downgrade that will weigh on Q2 net retention.
• Raised full-year guidance to $775 million–$790 million in revenue (7–9% growth) and increased the non-GAAP operating margin target to at least 5.5%, balancing strong execution with macroeconomic prudence.
• Expect Q2 net dollar retention to be pressured by downgrade activity in enterprise and technology segments, creating a near-term headwind despite stable in-quarter metrics.

Presentation

[Eva Leung, Head - IR at Asana]

Good afternoon, and thank you for joining us on today's conference call to discuss the financial results for Asana first quarter fiscal year twenty twenty six. With me on today's call are Duska Moskowitz, Asana Co Founder and CEO Anne Ramandi, our Chief Operating Officer and Head of Business and Somali Parekh, our Chief Financial Officer. Today's call will include forward looking statements, including statements regarding expected release and benefits of our product offerings, including AI Studio and our expectation for revenue to be generated by AI Studio our retention and expansion opportunities our expectation for our financial outlook, including our revised full year guidance, strategic plans and our market position and growth opportunities and our capital allocation strategy, including our stock repurchase programs. Forward looking statements involve risks, uncertainties and assumptions that may cause our actual results to be materially different from those expressed or implied by the forward looking statements. Please refer to our filings with the SEC, including our most recent annual report on Form 10 ks and quarterly report on Form 10 Q for additional information on risks, uncertainties and assumptions that may cause actual results to differ materially from those set forth in such statements.

[Eva Leung, Head - IR at Asana]

In addition, during today's call, we will discuss non GAAP financial measures. These non GAAP financial measures are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. Reconciliation between GAAP and non GAAP financial measures and a discussion of the limitation of using non GAAP measures versus the closest GAAP equivalents are available in our earnings release, which is posted on our Investor Relations website at investor.asana.com. And with that, I'd like to turn the call over to Dustin.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Thank you all for joining us on the call today. Q1 was a milestone quarter. We achieved non GAAP profitability for the first time and AI Studio, which reached general availability in Q1, surpassed 1,000,000 in ARR, demonstrating powerful early momentum. This progress fuels our journey to sustained profitable growth and positions Asana as the definitive platform for human and AI coordination. In Q1, total revenues were up 9% year over year, exceeding the top end of our guidance.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Non GAAP operating margins improved more than 1,300 basis points year over year from an operating loss margin of 9% to an operating income margin of 4%. That is a significant milestone for the company as we reach non GAAP profitability for the first time. Adjusted free cash flow margin also improved more than 700 basis points year over year, with free cash flow margin at 5% for the quarter. Once again, our non tech verticals grew faster than overall growth for the quarter and grew mid teens year over year. Some of our fastest growing verticals this quarter included manufacturing and energy, media and entertainment, and financial services.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We continue to make progress in our enterprise customer acquisition. Our hundred thousand dollar and over customers grew 20% year over year, consistent with last quarter. A landmark achievement last month was closing the largest deal in Asana's history with one of the largest employers in the world. This three year one hundred million dollar plus contract renewal is a testament to Asana's unique ability to power complex cross functional execution at an enterprise scale. The growth within this customer showcases a powerful combination of organic adoption and intentional expansion, driven by our close partnership with the enterprise engineering teams to demonstrate ongoing value.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

After a rigorous evaluation, Asana was selected as its company wide standard for project, task, work, and goal management, making Asana foundational to how they plan, track, and execute their most critical work. Now let's turn to AI Studio. We've seen tremendous momentum since our q four update, driven by customers recognizing the tangible value AI Studio delivers in solving real business problems. We've already crossed $1,000,000 in AI Studio ARR and are entering q two with robust and rapidly growing pipeline. The interest is truly global with strong traction across all our major geographies.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We're even seeing instances where AI Studio ARR is exceeding seat based ARR. This highlights how a few users leveraging AI Studio can drive outsized value, and it underscores our conviction that AI Studio has the potential to not only equip the revenue scale of seat based licenses over time, but also to reduce our overall reliance on per seat monetization. The cross vertical interest is also exciting with notable customer wins across manufacturing, retail, technology, financial services, and health care, demonstrating strong and widespread demand. What's most encouraging about AI Studio's momentum isn't the initial sales. It's the everyday usage we're seeing.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Because the product is embedded directly in the workflows teams rely on, automation happens where the work happens. That makes AI Studio inherently sticky, avoiding the shelfware fate of many hyped AI tools that live in separate apps or chatbots and end up underutilized. Our customers choose AI Studio for three clear reasons. First, it's built natively into Asana, eliminating the need for a behavior or workflow change. Second, its human in the loop controls are built on familiar Asana features, approvals, work assignments, comments, and audit trails, keeping people firmly in charge of every AI step.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Third, it runs on our work graph, a continuously updating data store of every project, task, goal, and conversation. That deep structured context lets AI handle longer, more complex workflows and enables true human AI coordination, something point solution agents simply can't match. This real world impact is evident with Woolworths, one of Australia's largest supermarket chains with over 1,000 stores. They've implemented AI Studio to transform their safety and capital governance process for store changes. Previously relying on inconsistent slide decks and meetings with up to 60 attendees, they've built a smart workflow with AI Studio that analyzes submissions, identifies required approvers, and automatically routes requests with all relevant context.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

This acceleration in decision making allows Woolworths to implement strategic store improvements faster while maintaining rigorous safety and compliance standards. This kind of targeted automation showcases how our AI capabilities drive both immediate ROI and deeper adoption within enterprise customers. We've also secured our first AI studio deal in India for a popular bakery chain. Working with a local partner, we've developed an AI Studio solution to prevent fuel theft across their fleet of dozens of vehicles, a common challenge in that market. Using a simple form to upload fuel receipts, AI Studio automatically extracts and logs fuel data, creating a complete audit trail while eliminating manual entry.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

This has given managers real time visibility into fleet expenses and improved coordination between drivers and finance teams. The solution is now fully embedded in their daily operations, delivering measurable efficiency gains within weeks of implementation. AI Studio is designed specifically for human AI coordination, enabling people to move work forward when and where they're needed. Stand alone agent models can only succeed when they're capable of automating entire workflows, ironically relegating them to narrow use cases. In contrast, we focus on augmenting human capabilities at key points in the process.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Triaging inbound requests, drafting briefs, extracting unstructured data, running deep research, or crunching complex analyses, while teams keep full visibility and control. We don't replace human expertise. We amplify it in a predictable way, freeing people to focus on higher impact work. The result, work moves faster, customers are cutting response times from days to hours, and eliminating slow meeting driven processes altogether, delivering immediate measurable productivity gains that compound over time. We are just at the beginning of a long term opportunity with AI Studio, our initial offering in a broader AI strategy.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

With AI Studio, our focus has been on empowering customers who wanna build their own AI powered workflows, automating steps, and taking on repetitive work within clearly defined and controlled processes. Realizing the full transformative potential of AI Studio and for it to truly become a major growth driver depends significantly on broader adoption across our customer base. To that end, to accelerate the uptake of AI and AI Studio, we're launching several key initiatives. Last month at our Work Innovation Summit event in Sydney, we launched the Smart Workflow Gallery, a suite of prebuilt AI powered workflows designed to help organizations scale the use of AI in everyday workflows. Based on best practices from a wide range of global companies, these smart workflows provide a blueprint for effective human plus AI coordination across marketing, IT, and operations.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Customers can choose to build from scratch with AI Studio or adopt one of these prebuilt workflows to get started with AI immediately. For instance, a creative team could deploy a gallery workflow in minutes to have AI review new work requests, evaluate briefs, gather information, flag blockers, and prioritize tasks, elevating humans out of tedious work while maintaining oversight. Our smart workflow gallery is now live with several key workflow templates for IT, marketing, and operations available today, And we'll be rolling out many more over the coming months. We're also introducing AI Studio Plus, a new mid tier package launching this month through sales and partner channels and later this summer for self serve customers. This strategic addition creates a three tier structure, basic, plus, and pro.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Each tier offers distinct value. Basic, which as of this month, will be available as part of all Asana paid tiers, provides AI Studio credits with monthly usage caps. Plus gives customers the flexibility to self serve and scale up their usage over time, while Pro delivers generous quarterly credit allowances and enterprise grade controls. This tiered approach ensures customers can select the right level of AI capabilities for their specific needs. Our strategy here extends beyond simply broadening access to AI Studio.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

By complementing it with new offerings, like foundational service plans and upcoming product add ons, such as resource management in q three, we are systematically enhancing how we deliver value. This approach is designed to improve price value alignment for our customers, which we expect will, in turn, strengthen net dollar retention. This is consistent with the value based pricing strategy we've discussed, and we see this combination as a powerful engine for significant long term expansion. Looking to h two, we'll be introducing new goal oriented agentic collaborators, AI teammates, rounding out the full spectrum of AI capabilities inside Asana. At the foundation of AI Studio is our AI powered workflow automation engine built to automate the repeatable workflows across your business.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

The smart workflow gallery packages these best practice automations into prebuilt AI workflows any team can deploy in minutes. AI teammates sit on top as more flexible agents. They keep multi step work moving with minimal guidance, leveraging prior context, our work graph, and fine grained permissions. For instance, a product lead can assign an AI teammate to implement a feature. It can write code using the quad code API, initiate and participate in review and approval workflows, generate and apply fixes in response to feedback, merge the update, and ask another dedicated AI teammate to get started on customer support material, all while posting live status updates in Asana showing its progress.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

By evolving these capabilities into a persistent coworker, we deepen human AI coordination and unlock usage based revenue streams beyond seat licenses, further strengthening our leadership and AI powered work management. We're fundamentally repositioning Asana as the platform for human and AI coordination, marking a powerful new chapter in our company narrative. As AI becomes integral to how work gets done, the need for a system that coordinates work between people and AI at scale is paramount. This is more than just a technological shift. It's a redefinition of teamwork itself.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We believe Asana is uniquely equipped to lead this charge. Our Warcraft data model provides the essential structured context, the map of an organization's work, goals, and processes that AI needs to be truly effective in a collaborative environment. This combined with our deep expertise in fostering human coordination allows us to build AI solutions that don't just automate tasks, but enhance clarity, alignment, and accountability across entire organizations. This is the generational opportunity we're seizing to find the future of how humans and AI achieve great things together. As we look to the future in regards to the CEO search, we're seeing strong interest in considering candidates carefully.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We'll be patient to find the absolute right leader to guide Asana through this next phase of growth. I'm fully committed to driving our strategy as CEO until my successor is in place. And I'm incredibly excited to partner with our future CEO on our product and AI strategy as we work together to establish Asana as the leader in this generational opportunity. Our key priorities for fiscal year twenty six are centered on setting Asana up for long term profitable growth. These include driving customer health, accelerating customer acquisition, and delivering increasing customer value through product innovation, particularly with AI.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

And with that context, let me turn it over to Anne to discuss our go to market momentum, key initiatives, and customer wins.

[Anne Raimondi, COO & Head of Business at Asana]

Thanks, Dustin. The strategic investments we've made along with the reallocation of resources towards higher leverage areas are driving incremental impact. We continue to make progress in scaling our enterprise motion. The number of customer net adds from the hundred k plus cohorts grew 20% year over year, same as last quarter. Our strategic multiyear renewal with one of the largest employers in the world is a testament to our differentiation in the enterprise as the collaborative work management platform best positioned to work at global enterprise scale. With hundreds of thousands of active users, teams are driving material impact across functions, which has translated into significant labor cost savings by eliminating manual work and meaningful improvements in employee productivity. Powered by our work graph, Asana connects goals, workflows, and data across silos while our enterprise grade AI accelerates execution by automating processes and surfacing real time insights at scale. International markets remain a key strength for our business driven by growing global demand for our platform, especially in EMEA and Japan.

[Anne Raimondi, COO & Head of Business at Asana]

As organizations worldwide recognize the value of Asana in improving coordination and driving productivity, our international revenue grew 11% year over year. To date, we haven't seen a material change in the demand environment in any of our segments or regions as compared to the last several quarters. However, we are beginning to see some increased buyer scrutiny and elongation in decisions related to broader consolidation or software stack transformation efforts. That said, the pipeline remains healthy. We're seeing strong demand generated across our diverse pipeline generation channels where initial investments, including our optimization of paid media, are driving greater leverage.

[Anne Raimondi, COO & Head of Business at Asana]

Let me discuss the progress on our three strategic growth priorities, customer acquisition, customer health, and customer value. First, customer acquisition. New business remains strong, and our investment in vertically focused go to market teams and driving adoption of vertical specific product use cases is resulting in strong growth in our nontech verticals, which grew once again in the mid teens, accounting for over 70% of our business. We're seeing particular strength in financial services, manufacturing, and media and entertainment. A few customer examples in our strategic verticals I wanna highlight are Buzzuto, which is a diversified real estate company specializing in multifamily residential communities across The United States.

[Anne Raimondi, COO & Head of Business at Asana]

They expanded their use of Asana in a three year deal. Asana will enable their nationally dispersed workforce to more efficiently manage projects and streamline workflows for property setups, maximize throughput, and reduce time to market. Additionally, they have invested in AI Studio to optimize work and automate various manual tasks, further enhancing operational efficiency. We had a great expansion deal in financial services. One of the largest credit unions in the world deepened their Asana partnership in a three year expansion deal.

[Anne Raimondi, COO & Head of Business at Asana]

The organization is using Asana in their core workflows across the real estate lending and contact center operations. Most importantly, after careful evaluation, the procurement team classified Asana as essential software that provides unique value for its cost. Their competitive analysis and ROI assessment showed that Asana effectively addresses their specific needs that no other solution can match, making us worth maintaining in their software portfolio. While tech continues to drag on our overall growth, we saw another quarter of stabilization of ARR in this vertical and strong demand for AI Studio from technology customers. Expanding our presence with the channel is a key growth and NRR expansion driver.

[Anne Raimondi, COO & Head of Business at Asana]

Since the relaunch of our partner program in March, we are making great progress with the channel. Deals with partners attached have exceeded our expectations and grew double digits year over year. Of our top five deals this quarter, three were partner led. We saw especially good traction in APAC and EMEA. Almost 40% of our APAC deals have partners attached, and we are seeing great digital transformation deals brought forth by our partners.

[Anne Raimondi, COO & Head of Business at Asana]

Partners are critical to our growth and scaling of AI Studio, and they also see it as a meaningful growth opportunity. We already have certified partners selling and supporting AI Studio. Moving to customer health, We've put renewed focus on addressing churn and downgrades, particularly with small monthly customers, which represents a disproportionate share of overall churn. We have a new chief customer officer in place to lead our retention efforts across segments, bringing greater executive focus and accountability to customer retention. We are enhancing early life cycle engagement with targeted onboarding to accelerate early engagement and tailored interventions based on churn risk.

[Anne Raimondi, COO & Head of Business at Asana]

In the mid market and enterprise, we're driving earlier detection through health scoring, strengthening renewal planning, and aligning teams more tightly around at risk accounts. While still early, these initiatives are showing encouraging traction and are central to our strategy to improve gross retention and NRR in the long term. In addition, we launched foundational service plans in early q one as a strategic initiative to boost customer health and retention while unlocking an additional monetization opportunity. The initiative has already proven highly successful in its first quarter, exceeding expectations with strong attachment rates, especially for new business, and generating over 7 figures in new business revenue. We remain focused on aligning price to customer value.

[Anne Raimondi, COO & Head of Business at Asana]

This is a key focus of our add on strategy in AI Studio. In Q1, we exceeded our internal plan with over $1,000,000 in bookings with strong traction across EMEA, APJ, and our first wins in Australia and India. The majority of AI Studio bookings came from existing customers. While the initial success has primarily centered on new business acquisition and expansion opportunities, AI Studio is becoming an important lever to mitigate downgrades in renewal conversations. A leading HR software company CIO initially planned to reduce seats due to budget constraints.

[Anne Raimondi, COO & Head of Business at Asana]

After showing the CIO the value of AI Studio, multiple teams, including creative ops, HR, and PMO decided to adopt AI Studio. The customer not only maintained their existing plan but expanded with AI Studio, turning potential churn into growth. As customers begin to pair AI Studio with our new smart workflow gallery, they're scaling these use cases faster and with less friction, opening up the potential for adoption of AI Studio across our base, not just those who build automations and custom workflows. With broader availability of AI Studio coming in q three via our self serve plus tier and on by default provisioning, we're positioned to scale AI Studio even faster in the second half of fiscal year twenty twenty six to both new customers and our existing customer base. Our team is focused on our strategic priorities and growth initiatives that are centered around the customer and believe these priorities position us well for long term growth reacceleration. And now I'll turn it over to Sonali.

[Sonalee Parekh, CFO and Head of Finance at Asana]

Thanks, Anne. Let me highlight the financial results for the first quarter and then comment more on the outlook. Q one revenues came in at 187,300,000.0, up 9% year over year, which exceeded the midpoint of our guidance by 1%. We have 24,297 core customers or customers spending $5,000 or more on an annualized basis. Revenues from core customers grew 10% year over year.

[Sonalee Parekh, CFO and Head of Finance at Asana]

This cohort represented 75% of our revenues in q one. We have 728 customers spending $100,000 or more on an annualized basis, and this customer cohort grew at 20% year over year. As a reminder, we define these customer cohorts based on annualized GAAP revenues in a given quarter. Our overall dollar based net retention rate was 95%. Core customer NRR was 96%.

[Sonalee Parekh, CFO and Head of Finance at Asana]

And among customers spending $100,000 or more, NRR was 95%. As a reminder, our NRR is a trailing four quarter average and, therefore, a lagging indicator of more recent trends. Our in quarter NRR was stable, and we saw improvement in logo churn across all cohorts. However, while our in quarter NRR was stable for the third consecutive quarter, we expect net retention in q two to be pressured. This is due to a combination of continued downgrade pressure, particularly in our enterprise and middle market segments and the technology vertical.

[Sonalee Parekh, CFO and Head of Finance at Asana]

While our 100,000,000 plus renewal, which we highlighted in our earnings today, materially increases our remaining performance obligations, providing greater visibility into fiscal year twenty seven and fiscal year twenty eight, It represents a modest ACV downgrade as compared to our prior contract. This will negatively weigh on our q two NRR, especially in our $100,000 cohort, as well as impacting the stability we have experienced over the past couple of quarters in our tech vertical. We are confident in long term NRR improvement given the investments we have made in our customer success teams, AI studio and add on strategy, our work to better align price to value, and focus on improving customer health. However, in the near term, NRR will remain a headwind, which results in strong new business momentum and scaling contribution from add ons and the channel being less prominently reflected in our overall revenue growth. Now moving to profitability, where I will be discussing our non GAAP results.

[Sonalee Parekh, CFO and Head of Finance at Asana]

We continue to be extremely focused on driving efficiency and productivity throughout our business, maximizing the operating leverage we enjoy from our strong gross margin, which held steady at approximately 90%. We expect to maintain these levels of gross margin in fiscal year twenty six while expanding sequential operating margin as we continue to scale. R and D expenses were 48,900,000.0 or 26% of revenue, down 11% year over year. Sales and marketing expenses were 83,700,000.0 or 45% of revenue, down 5.5% year over year. G and A expenses were 27,700,000.0 or 15% of revenue, up 2.2% year over year.

[Sonalee Parekh, CFO and Head of Finance at Asana]

As a result of driving productivity and efficiency gains, we had a positive operating income quarter for the first time in our company's history, delivering a 4% margin or 8,100,000.0 of operating income, which represents an operating margin of 300 basis points above the midpoint of our guide and a more than 1,300 basis point improvement year over year. Net income was 12,000,000 or 5¢ a share. Our profitability improvement was driven by rationalizing and reallocating program spend, particularly in marketing and lead generation to meet ROI thresholds without sacrificing pipeline and pipeline coverage, reallocating resources to more productive go to market motions, driving down infrastructure costs by optimizing our cloud spend, exercising discipline around all discretionary spend, and shifting certain hiring and backfilling to more cost effective regions like Warsaw and Reykjavik to optimize our onshore, offshore mix and to better align with industry benchmarks. Our continued focus on efficiency and productivity lays a strong foundation for continued operating leverage and multiyear margin expansion. Moving on to the balance sheet and cash flow.

[Sonalee Parekh, CFO and Head of Finance at Asana]

Cash and cash equivalents and marketable securities at the end of q one were approximately 470,800,000.0. Our deferred revenue, remaining performance obligations or RPO, and current RPO or CRPO were impacted by the timing of the 100,000,000 plus renewal, which typically is billed in q one but was renewed in and will be billed in q two going forward. Given that significant impact, we will also be providing those measures as adjusted for the large renewal. Our RPO was 420,700,000.0, up 11% from the year ago quarter, and adjusted for deal impact would have been approximately 521,000,000, up 37% year over year. CRPO will be recognized over the next twelve months and was 83% of RPO and grew 7% from the year ago quarter.

[Sonalee Parekh, CFO and Head of Finance at Asana]

CRPO adjusted for the deal timing would have been 73 of RPO, up 17% year over year. Our total ending q one deferred revenue was 290,300,000.0, down 2% year over year, and adjusted for deal timing would have been approximately 323,700,000.0, up nine percent year over year. Building on our operating margin strength, q one adjusted free cash flow was 9,900,000 or 5% on a margin basis, an improvement of more than 700 basis points. We continue to take a disciplined approach to capital allocation. Given our strong balance sheet, positive free cash flow, and confidence in our long term strategy, we believe share repurchases are an effective way to return value to shareholders while offsetting dilution.

[Sonalee Parekh, CFO and Head of Finance at Asana]

This quarter, we bought back $15,600,000 of our class a common stock at an average price of $15.09 or 1,000,000 shares. In May, our board increased our share repurchase authorization by $100,000,000 and removed the program's previous expiration date. As of April 30, we had $56,000,000 remaining under the prior authorization, representing a total of 156,000,000 available to us for repurchases moving forward. Now moving to guidance. For q two fiscal twenty twenty six, we expect revenues of 192 to 194,000,000, representing seven to 8% growth year over year.

[Sonalee Parekh, CFO and Head of Finance at Asana]

We expect non GAAP operating income of 8,000,000 to 10,000,000, representing an operating margin of four to 5%. And we expect non GAAP net income per share of $04 to $05 assuming diluted weighted average shares outstanding of approximately $243,000,000. For the full year, we are updating our revenue guidance to 775,000,000 to 790,000,000, representing 7% to 9% year over year growth. This range reflects two planning scenarios. The upper half assumes continued execution within a stable macro consistent with our q four view.

[Sonalee Parekh, CFO and Head of Finance at Asana]

The lower half anticipates elongated sales cycles, increased budget scrutiny, and a more cautious procurement environment, particularly with tech and enterprise customers. We continue to monitor the impact of economic uncertainty on buying and renewal activity. As Anne highlighted, while we have not seen material change in the demand environment, we are observing early signs of increased buyer scrutiny and downgrade activity, particularly in our enterprise and corporate customer bases. While these early signs alone do not change our previous outlook, we do recognize that there is a growing macroeconomic risk and thus are reflecting this risk by expanding our guidance range. We are raising our full year non GAAP operating margin guidance to at least 5.5% for the full year, up from our prior guidance of at least 5%, and continue to expect sequential improvement throughout the year.

[Sonalee Parekh, CFO and Head of Finance at Asana]

In addition, we expect net income per share of $0.22 assuming diluted weighted average shares outstanding of approximately $243,000,000. I want to highlight that if the macro environment were to deteriorate, we have multiple levers we can pull, which we believe would allow us to preserve profitability at the level of our guide without compromising the investments we have made and are making to drive revenue growth acceleration. As we shared last quarter, Dustin, Anne, and I remain focused on executing a long term strategy to drive long term growth acceleration while meaningfully expanding profitability. We are defining how humans and AI coordinate work at scale, and we see a massive greenfield opportunity ahead of us. We believe we have the right strategy in place to capitalize on this opportunity. And with that, operator, we're ready for questions.

[Operator]

Thank you.

[Operator]

Our first question comes from the line of Matt Bullock of Bank of America. Please go ahead, Matt.

[Matt Bullock, Equity Research Associate at Bank of America Merrill Lynch]

Great. Thanks for taking the question. I wanted to start on AI Studio. Great to see you cross that $1,000,000 ARR threshold. Dustin, maybe if you could just help us think about the breakdown of that 1,000,000 ARR.

[Matt Bullock, Equity Research Associate at Bank of America Merrill Lynch]

What does that consist of? Which types of customers and use cases are driving strong uptake? And then maybe walk us through some of the potential upside scenarios for the back half of fiscal twenty six.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Yeah. Thanks. That's a a great question. So the the 1,000,000 ARR, really represents a a great, sort of diversity and distribution of customers. We have a good number of examples from every region and across different industries and across the different, different segments as well.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

So I feel really good about that. And this is entirely, comprised right now of the AI Studio Pro platform fees. So part of the, upside in the future will come from potentially getting into the incremental consumption, and we are still seeing great patterns over time with customers continuing to use more and more credits month after month and gain confidence in the system as well as seeing the newer cohorts of customers. A lot of the customers have joined in the past two months. They're starting out faster and consuming more credits out the gate.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Part of the reason for that is the launch of the Smart Workflow Gallery. Just came out a few weeks ago, but it'll it lets you deploy, both AI Studio and if you're not in AI Studio, you can have it without AI, prebuilt templates. And we're seeing where you do have Studio turned on, that is working as intended. We're seeing a lot of those get installed, and drive credit usages as well. And then, two more catalysts that I think provide, upside throughout the year.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We're launching the the plus SKU, which is gonna be a lower priced, more affordable SKU, I think later this week, actually, for for sales to start selling and to become self serve later in the summer. That will open us up more to the SMB market and help customers, you know, get started when they need more than what's available in basic and and less than what's needed in pro. And then also, AI teammates, which is a a little bit of a a new part of the the AI roadmap for fiscal year twenty six, but, I think it's gonna be a a big factor in in h two and and will help, a lot more, end users get the benefits of AI because it doesn't require, building workflows or being part you know, getting into the automation builder at all. It it really is as easy to use as as working with, with normal human teammates. So we don't know how well, Plus and and teammates will do, but, you know, seeing all the right things from what we have in market today and, you know, have a lot a lot more that we'll launch throughout the year.

[Matt Bullock, Equity Research Associate at Bank of America Merrill Lynch]

Super helpful. Thanks, Dustin. And just a quick follow-up for Sonali, if I could. I wanted to ask about the $100,000,000 contract renewal. I believe you mentioned that was in the tech vertical, but are there any other details you can share about that renewal process?

[Matt Bullock, Equity Research Associate at Bank of America Merrill Lynch]

Maybe help us think about the change and quantifying the change in a ACV there. And then is there anything you can share on how much AI Studio is embedded in that renewal? Thanks.

[Sonalee Parekh, CFO and Head of Finance at Asana]

Sure. Absolutely. So you're you're right. It was in our tech vertical, that renewal. I just wanna highlight again, it was the largest deal in Asana's history, so a hundred million TCV over three years.

[Sonalee Parekh, CFO and Head of Finance at Asana]

The renewal slipped out of q one and into early q two, which is why I shared, pro form a balance sheet metrics around RPO and CRPO. And whilst it was a significant expansion in TCV versus the previous contract, there was actually a modest downgrade on an ACV basis. So that will actually impact, and you heard me call this out in prepared remarks, that will impact our overall net retention and particularly from q two and as we look across the rest of the year. And and as you, you know, correctly assumed, yes, it will weigh on the tech vertical, which up to now and over the past couple of quarters had been showing, signs of stability. So, you know, with this multiyear deal, we feel like it was a trade off we were willing to make in terms of the slight ACV downgrade because we now have much greater visibility into fiscal year twenty seven and twenty eight given the significant increase in RPO that that actually drives.

[Sonalee Parekh, CFO and Head of Finance at Asana]

In terms of the contribution to AI Studio specifically from that, renewal, there's nothing factored in, in the guide, right now. That is potential upside. But I think it's worth me just handing over to Anne just to talk a little bit more about that renewal and and the Landmark deal and why they chose to work with Asana.

[Anne Raimondi, COO & Head of Business at Asana]

Yeah. Thanks, Emily. Yeah. Happy to add more there. What we're really excited about is the long term commitment from this leading global enterprise customer.

[Anne Raimondi, COO & Head of Business at Asana]

It really allows us to deepen our strategic partnership with them and continue to innovate with this very exceptional company. Some things that I'm particularly excited about, you know, they ran a really rigorous process to choose us and have now a long term commitment. I think the other thing that we're really excited about is the use cases across this organization can serve as inspiration for other enterprise customers. It also shows off our, you know, our strength in scalability, security, our vision, and compliance at the highest levels. Some of the really diverse business critical use cases across their business units and functions that we're very excited about and continue to expand.

[Anne Raimondi, COO & Head of Business at Asana]

So everything from change management and global logistics, managing complex workflows for new product and new device launches, to developing operational bench benchmarks for process improvement and managing client workflows for their large global accounts team. And then altogether, they are also doing cross functional goal setting, reporting, project and portfolio status update management across several hundred thousand employees. So it's it's exciting to continue to build this relationship and now, as Donalie said, have visibility over the next three years, on our ability to deliver value but then also deliver upside.

[Operator]

Thank you. Our next question comes from the line of Alan Verkowski of Scotiabank. Please go ahead, Alan.

[Allan Verkhovski, Associate Director - Equity Research at Scotiabank]

Hey. Thanks so much for taking the question. I wanna ask another question on AI Studio, but more from an ROI perspective. Dustin, it's exciting that you're seeing instances of AI Studio ARR exceeding seat based ARR. At the same time, there are many agents that SaaS companies are selling, which I would imagine makes it a bit harder for customers to see the ROI to justify why to pay more for AI Studio.

[Allan Verkhovski, Associate Director - Equity Research at Scotiabank]

What are your top learnings thus far in selling it? And can you update us on your confidence to have a whale that you mentioned last quarter on AI Studio that are spending 6 or 7 figures on it by the end of the year?

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Yeah. So this is Dustin. I'll I'll try and unpack those questions. I may need a little bit of clarification. Can can you say more about, the agents we're competing with?

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Why why do you think they're paying more with Asana? Or, maybe I'll just I'll try and project and

[Allan Verkhovski, Associate Director - Equity Research at Scotiabank]

I meant to just felt like a lot of software companies are trying to monetize AI agents, which I can imagine makes it a little harder for customers to see through that.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

To see through that.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Yeah. I mean, I I think that the, the distinction with Asana is is that they're more successful, deploying these. So, you know, I think what you get when you have stand alone agents in another system is is partially you need a lot of behavior change, but the the bigger issue that I've seen in practice is that you need them to be able to take on, an entire workflow, and kind of replace, kind of replace an entire person. And because of that, you're you're not as successful as often. And so customers are are turning to Asana because they see that they can, they can take on part of a workflow that can be done by AI and sort of hand back and forth with a human or or multiple humans that are on the team, and that lets them be successful in a lot more areas and as a consequence, across more use cases.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

So a lot of the agents that that other vendors are putting out, are more specialized, especially to support. And we we can do versions of that, but the the types of, examples that we were giving with with request intake and campaign management and, developing, assets, that diversity of use cases, works much more on a on a platform like Asana, that can handle all of that. In terms of customers that are paying more than their seat licenses right now, all of the customers are paying about the same for these pro packages. And so that is largely a function of the fact that they don't have many seats. But some of them are still getting enough value out of pro that they are buying this larger package, and it and it's worse what they're paying for the seats.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

What I'd love to see is for that to happen in even bigger accounts. So to have studio revenue eclipsing, you know, a 6 or seven figure, you know, existing account, I think that will take longer. It does take time for, the usage to compound, but we are seeing it build. And we're getting better at assisting customers. Customers are getting better at solving it themselves.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We're building up this library of great templates with the smart workflow gallery. All of that will just increase it, you know, increase the the scale of what we can sell to an individual customer. And, you know, I I still think it's, like, pretty likely that we'll have some at the end of the end of the year, but, you know, I don't have any it's not like we have one in pipeline, so I can't I can't guarantee it. But, I'm seeing all the right things and, you know, see all these additional catalysts for how we can get a lot more usage, including, you know, teammates could could really change the game, particularly for customers that are already adopted on Studio by the time we launch them. We'll have some that have been using it for two or three quarters, and teammates will let them go much further very quickly.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

And I think that'll be a big asset. And then finally, one one I haven't even mentioned is is we're seeing the emergence of more expensive models like Opus and o three. And as we introduce those in the system, it actually gives the customers the ability to to spend more credits on the same workflows if they just want higher quality.

[Allan Verkhovski, Associate Director - Equity Research at Scotiabank]

Awesome. That's really helpful. And then, Sonali, just a quick follow-up for you. Can you share how you're thinking about, you know, revenue from tech customers as part of the updated fiscal twenty six guidance and also what you're estimating in terms of impacts from FX versus before?

[Sonalee Parekh, CFO and Head of Finance at Asana]

Yeah. Sure. So just firstly on to clarify, on q one, the impact from FX was actually very minimal. It was a couple of hundred thousand dollars. We don't really tend to call that out, especially if it's not material, but I I think a couple of other people had that question.

[Sonalee Parekh, CFO and Head of Finance at Asana]

So it was it was very de minimis. In terms of how we're thinking about the tech vertical, obviously, we called out, you know, this large renewal, being in the tech, vertical. So, it will continue to have an impact on, what we had been seeing in in our tech vertical in terms of recovery. But the actual year over year revenue growth in our tech vertical was fairly stable this quarter as it had been in the last couple of quarters. And we don't tend to break out tech versus nontech on a forward basis in terms of how we're guiding.

[Sonalee Parekh, CFO and Head of Finance at Asana]

But what I would say is that nontech is still growing, which is, you know, close to it's about, you know, between 2530% of our business today is is tech, and nontech is the rest. That's growing in the mid teens and still healthily grow growing in the middle mid teens. So I would say expect apart from that downgrade that we've called out specifically in the renewal, the rest of the tech vertical, we would expect to be fairly stable.

[Operator]

Thank you. Our next question comes from the line of Steve Enders of Citi. Your question, please, Steve.

[Steve Enders, Analyst at Citigroup]

Okay. Great. Thanks for taking the questions here. I guess I just wanna maybe follow-up on some of the pressure you're seeing in in the macro side of it. You know, I think you called out, you know, downgrades on enterprise and and mid market.

[Steve Enders, Analyst at Citigroup]

And if I remember it in the past, it it seemed like it's primarily centered on the tech side. I I guess I just wanna understand, is this maybe new pressure that you're seeing in those segments being impacted across other verticals? Or can you just maybe clarify, you know, what exactly it is that you are seeing within the the enterprise and mid market front right now?

[Anne Raimondi, COO & Head of Business at Asana]

Hi, Steve. It's Anne. I'm happy to take that. I think what we just started to see early was, you know, some customer budget pressures. There's still some ongoing workforce reductions and then consolidation of tools under centralized IT management.

[Anne Raimondi, COO & Head of Business at Asana]

Where we saw this in particular was in enterprise and the Americas region, which for us, you know, has a disproportionate share of tech. But we're actively working to mitigate a lot of the turn and contraction through all our investments in additional customer success management coverage, identifying at risk customers earlier, introducing our new, more flexible pricing. And then, in particular, I think where we feel like the mitigation is gonna come on contraction and churn is with AI Studio and our foundational service plans. Those really do two things. One, with AI Studio, higher value business impacting workflows and adoption.

[Anne Raimondi, COO & Head of Business at Asana]

And then with the foundational service plans, what the customers are really getting is, you know, ongoing onboarding support services and the ability to get value faster. So I think and, you know, additional products that they're buying for us. So, while we're seeing some of the, you know, early signs, I think we've got things in place to help mitigate it over the long term.

[Steve Enders, Analyst at Citigroup]

Okay. Great. That's, that's helpful. And then, I guess, I just wanna clarify on the revenue guide and, I guess, the the lowered, the lowered, I guess, low end of it. And appreciate some of the commentary around kinda what's been assumed.

[Steve Enders, Analyst at Citigroup]

But I do wanna ask on, I guess, as we think about the lowered aspect of it specifically in that scenario, just how scrubbed would you say that, that scenario is? Or maybe kinda what's

[Sonalee Parekh, CFO and Head of Finance at Asana]

Yeah.

[Steve Enders, Analyst at Citigroup]

I guess, how much negativity is being assumed on on that low end guide?

[Sonalee Parekh, CFO and Head of Finance at Asana]

Sure. So the low end of the guide is definitely taken into account, you know, being much more prudent. It reflects not just the trends that Anne called out just now around what we're seeing, but it actually reflects additional risk and additional macro, pressure, which we have not seen yet. But we wanted to provide a guidance range that, you know, at the high end is reflecting what we see today. And then at the low end incorporates a potential worsening given there's a there is a lot more uncertainty out there today than when I last guided, which was in March with with our q four, earnings.

[Sonalee Parekh, CFO and Head of Finance at Asana]

So we're comfortable with the range we provided, and we feel like it's you know, covers a wide range of outcomes. But, certainly, the low end factors in a more bearish view on net retention from where we are today and the macro worsening. Hopefully, that's clear.

[Operator]

Thank you. Our next question comes from the line of Josh Baer of Morgan Stanley. Please go ahead, Josh.

[Joshua Baer, Executive Director - Software Equity Research Analyst at Morgan Stanley]

Great. Thank you for the question. If we do make the adjustment on the deferred and pull that into Q1, I think billings growth was around 5%, which was below the history here. So just wanted to see how Q1 billings really performed versus your internal plan. And then the follow-up would be just anything to call out as we navigate billings for the rest of the year as far as seasonality or with regard to other renewals or dynamics over the next several quarters.

[Sonalee Parekh, CFO and Head of Finance at Asana]

Yeah. So you get an a plus on your math. Pro form a, that's exactly what it was. So, it was about 5% in q one. And q one is seasonally lower for us in billings growth typically, and you'll even see that in the trends last year.

[Sonalee Parekh, CFO and Head of Finance at Asana]

And that's because of the timing of our multiyear deal renewals, and they tend to accelerate into the second half of the year. And given the downgrade pressure that we're seeing and that Anne called out in enterprise, which tend to be annual or multiyear deals and upfront billing, that weighs our billings naturally. But what I would say is on the other side, on the flip side, we're continuing to see strength in our SB business, which is offsetting some of that pressure. And if you think about full year billings, it should be in line with our guided revenue growth range.

[Joshua Baer, Executive Director - Software Equity Research Analyst at Morgan Stanley]

Okay. Great. That's helpful. And I'm just wondering, you meant suddenly, you mentioned a trade off with regard to the large deal. Is that in, like, thinking about volume discounting in return for the longer duration on that contract?

[Sonalee Parekh, CFO and Head of Finance at Asana]

Yeah. So I I'm talked about a modest ACV downgrade, so what we get from them annually, but we felt like that was definitely worth the trade off given you know, Anne talked about the strategic importance of this deal. And the other thing is we're in there now. We're in there for the next three years, and there's you know, someone earlier asked a really great question about is AI Studio in in that deal? No.

[Sonalee Parekh, CFO and Head of Finance at Asana]

It's not today. Are FSPs in that deal? Not today. So these are all potential areas of upside. And, you know, again, we we would we would do that kind of deal again.

[Sonalee Parekh, CFO and Head of Finance at Asana]

So, yes, it was definitely worth the trade off. And, you know, it's a long term commitment, and we love the visibility it provides for fiscal twenty seven and '28. We think it's a real validation of our leadership position in this category and our ability to scale. You know? They wanted to work with us.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Yeah. I'll I'll just add on, since Sona said the magic word. We're we're really excited to, announce that today we are named as one of just two leaders in the Forrester Q1 collaborative work management wave. So I think that, that only reinforces that we have a special position in enterprise here.

[Operator]

Our next question comes from the line of Taylor McGinnis of UBS.

[Taylor McGinnis, Equity Research Analyst at UBS Group]

I just want to press on NRR. So it sounds like in period NRR in 2Q is expected to come down both from the $100,000,000 renewal coming in on the ACV side and then also an uptick in potential downgrade activity given some of what we're seeing in the macro. So Emily, can you just unpack that a little bit more for us? Like, when you think through those two potential impacts, like, any way to help us, you know, quantify and think about what the trajectory of NRR could look like from here?

[Sonalee Parekh, CFO and Head of Finance at Asana]

Yeah. So, no problem, Taylor. So in quarter NRR for this quarter was actually stable. And the rolling four quarter, which, as you know, is an average of the trailing last four quarters, that actually went down in this current quarter. And that was really due to the composition of the cohort.

[Sonalee Parekh, CFO and Head of Finance at Asana]

So Q1 of fiscal twenty five actually had a relatively higher NRR. So as that quarter dropped out of the calculation, the average declined. But as we look forward, and I think that's what you're more interested in, yes, this, renewal with this large enterprise tech, customer will factor into, or will weigh down on our net retention from q two and for the rest of the year. And, the only thing I would say there is that, you know, if you look at, our in quarter $100,000 plus cohort of customers, that actually improved this quarter and in quarter, which is really encouraging. And the other thing I would say is that, you know, the what we're seeing from the logo side of things, we're actually seeing decreased logo churn.

[Sonalee Parekh, CFO and Head of Finance at Asana]

So customers are choosing to stay with us even if they downgrade seats. And I think that, you know, what what makes us feel really good about that is that those are upsells in future quarters. So I think when we think about our NRR as we go forward, q two to q four is likely to be pressured because of this, deal that we've called out and also because of the enterprise trends that Anne called out. But some of the things we're doing on AI Studio, our multiproduct approach, some of the add ons that we have coming in the second half of the year will help to mitigate some of that pressure.

[Taylor McGinnis, Equity Research Analyst at UBS Group]

Perfect. And then my second question is just you talked about some of the levers that you have in the business, potentially if we start to see a slowdown in growth from some of the uncertainty out there. You saw good upside to operating margins this quarter. So can you just maybe comment on you had the RIF last quarter, how much of like the upside that we saw was savings from that versus maybe other sources of cost saving and efficiencies you're seeing in the business? And if we do see that scenario of a slowdown, maybe you could just talk through some of the potential sources of upside on the margin line.

[Sonalee Parekh, CFO and Head of Finance at Asana]

Sure. So thanks. We're really proud of what we've done on both the operating margin and free cash flow margin side of the business, 1,300 basis points year over year improvement. And those cost actions that you referred to that we took at the end of last year, they were factored into the guidance. And, of course, they ramp throughout the year.

[Sonalee Parekh, CFO and Head of Finance at Asana]

So they help to drive that quarter over quarter or sequential margin expansion story, and that that's from actions we've already taken. So you get that that margin expansion without doing anything incremental. And we've guided to at least 5%, implying that there was upside at the time. And now, of course, today, we raised that guide to at least 5.5%. And, you know, there will be a continued focus from Dustin and myself and the entire team around driving efficiency and looking for, incremental savings opportunities.

[Sonalee Parekh, CFO and Head of Finance at Asana]

When you ask about specific areas, we think that there's more, leverage we can drive from increased productivity around our go to market and marketing spend and then additional work on vendor rationalization. And, you know, you've heard us talk about the, geographic mix of our workforce, and we do that actually via attrition for the most part. And, you know, we feel that over time, we can get much closer to where industry benchmarks are for a company of our our, size and scale and growth profile. So there's a lot more to go here. We're super happy with the progress we've made, and you should consider margin expansion on a multi quarter and multi year basis to continue.

[Operator]

Thank you. Our next question comes from the line of Lucky Schreiner of D. A. Davidson. Please go ahead, Lucky.

[Lucky Schreiner, AVP - Research Analyst at D.A. Davidson]

Great. Thanks for taking my question. Just one from me. It it was interesting to hear about the the leading HR company initially planning to reduce seats, but but after AI Studio expanded their plan. Maybe taking that a step further, how do you view consolidation trending in the work management space here?

[Lucky Schreiner, AVP - Research Analyst at D.A. Davidson]

And does AI Studio act as a as a potential catalyst for for larger customers to consolidate onto Asana? Thanks.

[Anne Raimondi, COO & Head of Business at Asana]

Yeah. Lucky, thank you for that question. I think what we're seeing is we certainly feel like there's a couple opportunities for consolidation. One is even just point solutions. So by having workflows all on Asana, there's things as straightforward as translation and localization workflows that might be being done by customers with point solutions right now that are very easy to move on to Asana.

[Anne Raimondi, COO & Head of Business at Asana]

And so those point solutions that might do, you know, basic intake flows or even ticketing, the benefit of consolidating onto Asana is, one, the reliability of the data that customers are working with, the context on which team, which department, which tasks, which portfolios, all of that is in Asana, plus all the benefits that have always been on Asana, which is cross team collaboration. So we're certainly seeing that. And then I think your question around consolidation of work management, again, I think the benefit of everybody working on the same platform as well as our ability to give customers the choice on which models, I think, has been really powerful and differentiated and the transparency on how the AI Studio workflows are working behind the scenes. So we certainly look for more consolidation opportunities, but we're already starting to see those point solutions be replaced by workflows on Asana.

[Lucky Schreiner, AVP - Research Analyst at D.A. Davidson]

Makes sense. Thanks.

[Operator]

Thank you. Our next question comes from the line of Patrick Walravens of Citizens Bank. Please go ahead, Patrick.

[Patrick Walravens, Analyst at Citizens JMP Securities, LLC]

Oh, great. Thank you. Hey, Dustin. I I I wanna take the conversation up a level if it's alright with you. I would love to hear your thoughts on the future of work for young humans.

[Patrick Walravens, Analyst at Citizens JMP Securities, LLC]

So, you know, we all know that last week, Dario at Anthropic made the comment about up to 50% of entry level white collar jobs maybe being eliminated and unemployment spiking. I know you give these matters a lot of thoughts, so I'd love to hear your your your perspective sort of high level, you know, for our society and then maybe, where Asana might have a role to play.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Yeah. Thanks. Great question. You know, I think my perspective is mainly just that, you know, AI is real and and we're not really prepared for it. And I think that that was, you know, mostly what Dario was going for is he's trying to he's not trying to, you know, solve the problem from from his seat as a CEO in one company, but trying to, get the attention of society and get the attention of government on it.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

And, you know, personally, I think part of that equation will will need to be some some redistribution of wealth, which is not very conducive to the current political environment. But I I think that would be the ideal kind of solution, because I think it will be very, very tough to transition the entire working population, into a new way of working. And in a lot of cases, it it won't make the the most economic sense. So I I think the the real solution we need there is is is higher level than what individuals can do. The best advice I have heard for individuals and for young people, it was either on the Dorkish podcast or on Hard Fork, but, one one of the guests was saying, you know, think think think more about, you know, what you would want to, you know, you know, do in the world without paying as much attention to how hard it is to build because maybe that part will be easy later.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

Sure. And so more focus on the skills that are less around, you know, business management and building a company and more around, you know, whatever the specialty is that that you wanna go into. That that made some sense to me, but I don't pretend to have all the answers in my pocket on this one. I think it's a really big issue. I think change will happen faster than most people believe.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

And and I agree with Daria that we shouldn't sugarcoat it. I think it will be difficult. And I hope that Asana has a role to play in, making it as smooth as possible for organizations and for employees, making it easy to use these new tools, and have them be a companion, you know, at least for the, the time before, you know, there there's massive, job displacement, you know, I think it will be an enhancement and will make people's lives easier, and we'll just give people more leverage in their work. And we can be part of that. We can be part of making it safe.

[Dustin Moskovitz, Co-Founder and CEO at Asana]

We can be part of making it secure, and we can help organizations get from here to a radically different future.

[Patrick Walravens, Analyst at Citizens JMP Securities, LLC]

Thank you, Dustin.

[Operator]

Thank you. I would now like to turn the conference back to Eva Long for closing remarks. Madam?

[Eva Leung, Head - IR at Asana]

Thank you for joining our call today. If you have any questions, feel free to call or email me. We'll be on the road at BofA Conference tomorrow and Bayer Conference on Thursday and DA Davidson next week. Looking forward to seeing you there. Thank you.

[Operator]

This concludes today's conference call. Thank you for participating. You may now disconnect.

Participants

Executives

• Eva Leung, Head - IR
• Dustin Moskovitz, Co-Founder and CEO
• Anne Raimondi, COO & Head of Business
• Sonalee Parekh, CFO and Head of Finance

Analysts

• Matt Bullock, Equity Research Associate at Bank of America Merrill Lynch
• Allan Verkhovski, Associate Director - Equity Research at Scotiabank
• Steve Enders, Analyst at Citigroup
• Joshua Baer, Executive Director - Software Equity Research Analyst at Morgan Stanley
• Taylor McGinnis, Equity Research Analyst at UBS Group
• Lucky Schreiner, AVP - Research Analyst at D.A. Davidson
• Patrick Walravens, Analyst at Citizens JMP Securities, LLC