Confluent, Inc. (NASDAQ:CFLT) Q2 2024 Earnings Conference Call July 31, 2024 4:30 PM ET

Company Participants

Shane Xie - Investor Relations
Jay Kreps - Co-Founder & Chief Executive Officer
Rohan Sivaram - Chief Financial Officer

Conference Call Participants

Matt Hedberg - RBC
Sanjit Singh - Morgan Stanley
Raimo Lenschow - Barclays
Brad Zelnick - Deutsche
Jason Ader - William Blair
Derrick Wood - TD Cowen
Rudy Kessinger - D.A. Davidson
Alex Zukin - Wolfe Research
Kash Rangan - Goldman Sachs
Pinjalim Bora - JPMorgan
Ittai Kidron - Oppenheimer
Gregg Moskowitz - Mizuho
Mike Cikos - Needham
Michael Turrin - Wells Fargo

Shane Xie

Hello, everyone. Welcome to the Confluent Second Quarter 2024 Earnings Conference Call. I'm Shane Xie from Investor Relations, and I'm joined by Jay Kreps, Co-Founder and CEO; and Rohan Sivaram, CFO.

During today's call, management will make forward-looking statements regarding our business, operations, sales strategy, market and product positioning, financial performance and future prospects, including statements regarding our financial guidance for the fiscal third quarter of 2024, and fiscal year 2024. These forward-looking statements are subject to risks and uncertainties, which could cause actual results to differ materially from those anticipated by these statements. Further information on risk factors that could cause actual results to differ is included in our most recent Form 10-Q filed with the SEC. We assume no obligation to update these statements after today's call, except as required by law.

Unless stated otherwise, certain financial measures used on today's call are expressed a non-GAAP basis, and all comparisons are made on a year-over-year basis. We use these non-GAAP financial measures internally to facilitate the analysis of our financial and business trends and for internal planning and forecasting purposes. These non-GAAP financial measures have limitations and should not be considered in isolation from or as a substitute for financial information prepared in accordance with GAAP. A reconciliation between these GAAP and non-GAAP financial measures is included in our earnings press release and supplemental financials, which can be found on our IR website at investors.confluent.io. And finally, once we've concluded our prepared remarks, we will post the Confluent earnings report to our IR website.

And with that, I'll turn the call over to Jay.

Jay Kreps

Thanks, Shane. Good afternoon, everyone, and welcome to our second quarter earnings call. I'm pleased to report a solid second quarter, once again exceeding our revenue and margin guidance despite a continuing volatile macro environment. Subscription revenue grew 27% to $225 million, Confluent Cloud revenue grew 40% to $117 million, and non-GAAP operating margin was positive, representing approximately 10 percentage points of improvement. These results underscore the power of our data streaming platform and our relentless focus on delivering success for our customers.