Good morning, everyone, and welcome to the DeCebo Q1 2026 earnings call. All participants are currently in listen-only mode. We will open the line for a question and answer session momentarily. Analysts can ask questions by pressing star, then the number one on their telephone keypad. We ask that analysts please limit themselves to two questions and return to the queue for any follow-up. I'd now like to turn the call over to Docebo's Vice President of Investor Relations, Mike McCarthy. Please go ahead, Mike.

Thank you, Sarah. Earlier this morning, Docebo issued its fully audited Q1 2026 results. The press release, which included a link to management's prepared remarks and our quarterly investor slide deck, were all posted to our Investor Relations website. This morning's call will allow participants to ask questions about our results and the written commentary that management provided this morning. Before we begin this morning's Q&A, Docebo would like to remind listeners that certain information discussed may be forward-looking in nature. Such forward-looking information reflects the company's current views with respect to future events. Any such information is subject to risks, uncertainties, and assumptions that could cause actual results to differ materially from those projected in the forward-looking statements. For more information on the risks, uncertainties, and assumptions relating to follow-up statements, please refer to Docebo's public filings, which are available on CEDAR and EDGAR. During the call, we will reference certain non-IFRS financial measures. Although we believe these measures provide useful supplemental information about our financial performance, they are not recognized measures and do not have standardized meanings under IFRS. Please see our MD&A for additional information regarding our non-IFRS financial measures, including reconciliations to the nearest IFRS measures. Please note that unless otherwise stated, all references to any financial figures are in U.S. dollars. Now I'd like to turn the call over to Docebo's CEO, Alessio Artufo, and our CFO, Brandon Farmer. Sarah, you can open the queue.

Thank you. If you would like to ask a question, please press star 1 on your telephone keypad. If you would like to withdraw your question, simply press star 1 again. As a reminder, please limit yourself to two questions.

Thank you.

Your first question comes from Ryan McDonald with Needham. Your line is open.

Yeah, good morning, everyone. Thanks for taking the questions, and congrats on a great quarter. Alessio, we're obviously about a week or so post-Inspire now. There's a lot of, obviously, great product updates and events, a lot of enthusiasm from customers around a lot of features and functionality. But I'd love to get a sense of the conversations you're having with your prospective enterprise customers. Is the focus right now really on sort of updating and modernizing the LMS and focusing on some of those core, let's call it external use cases? or are you starting to see some of those conversations evolve to really be leading the conversation with some of the new AI features as they're thinking about the modernization cycle?

Good morning, Ryan, and thank you for the question. First of all, let me touch base super quickly on the Shabo Inspire. Thank you to those of you that made the trip to come see. what I hope you agree with was an incredible experience Inspire is always a place where the energy drives this year was growth across all factors we had 20% growth in attendance with over a thousand people attending a significant portion of our key customers were there we had more than 20% of our ARR in the room on a financial basis and yeah we were just and really, really overall very pleased with the event itself. When it comes to key customers and enterprise customers, enterprise prospects, the conversations we're having, Ryan, are along the lines of what you are hinting and suggesting your question. Let me walk you through a couple of the themes that I believe are prevalent. First, I think, you know, what I'm hearing from prospects and customers both is that we are going through the most significant transformation of the past few decades. And I'm, of course, referring to the transformation into this new agentic AI world. Now, our buyers are not developers. They are talent, HR, learning leaders. And now, more than ever, what they want is to partner with companies that truly operate as a partner and, you know, support the customer throughout this transformation and don't operate as technology vendors alone. That was the, I would say, shared sentiment across the board. Then, the second part of this equation is, in the enterprise sector, the large majority of the market is a substitution market. Everybody has a LMS or a comparable platform. And these companies, these enterprises now are facing a generational moment that is very transitional, and they are evaluating, stepping out of the legacy world, often from vendors that have been really preoccupied with the technical debt, with integrating multiple roll-ups, that as a result of that have given up innovation. And so, they don't just want a partner, they want a partner that is a grown-up and that is an innovator. And when you look at the landscape of our competition, I was sitting in a room with one of the largest, you know, financial services firms in North America, and I asked right out, asked them the question, what are your alternatives to your current and soon-to-be legacy provider?

And the answer was, Docebo. So, that's it.

It's great to hear. I really appreciate all the color on that in the context. Brandon, maybe for you, I'm curious, as you think about the enterprise customer base sort of in the opportunity and pipeline coming out of Inspire, how are you feeling about sort of where the state of the pipeline is early in the year here within that sort of enterprise cohort of customers? And then I was really impressed by the level of demand you were seeing for 365 talent. So, curious if what you saw at Inspire is sort of changing your view or outlook for that acquired asset in particular for 26.

Thanks for the question. On the enterprise piece, we certainly had a great quarter from an enterprise perspective. Q1 was the first quarter where we saw real strength in the market after 2025 where there was, you know, ebbs and flows within that segment. And from a Q1 perspective, it wasn't just sales execution. It was also strong demand. While when I think about our guide, we're still being conservative from an enterprise perspective, because from my perspective, there is not a trend. If you look at our guidance philosophy from last year, it really took us three quarters of mid-market strength before we started embedding that assumption into our model. We're going to wait two to three quarters for enterprise strength in order for us to flow that forward. But we're seeing really strong signs in the enterprise segment that will allow us to continue to be raised throughout the year. From a 365 perspective, we're holding our revenue assumption at $9 million per year. We saw a really strong demand from our Docevo customers at Inspire. I believe there's a stat about 50% of our customers went through the booth and viewed the demo. So, we're seeing strong demand signals. It is still early, you know, with any acquisition. You know, it does take some time for your Docevo staff to learn the product, be knowledgeable on how to implement it and demo it. So, we're seeing really strong signs that H2 will go in accordance with their acquisition business model.

Appreciate it, Kaur. Congrats again. Thank you.

Your next question comes from Richard T. with National Bank Capital Markets. Your line is open. Richard, perhaps your line is on mute.

With Agent Hub really getting a tremendous amount of traction, particularly at Inspire, are there any sort of leading indicators that we should be tracking kind of ahead of that big rollout just to sort of assess how the demand is sort of building for it?

Morning, Richard. Agent Hub, as you mentioned, is our own agentic infrastructure product that we are soon to be releasing in GA, inspired for context when everybody's on the call. We have demonstrated the real agents at work and demoed them live and not in a constructed video for the 1,000-plus people in the audience. Agent Hub aims at solving, executing moderate to complex LMS and beyond capabilities at scale in automated ways. We're super excited about it. And we lead in that sense because in our market, this is a very innovative product. Having said that, a couple of things that we believe are good leading indicators. At Inspire alone, Richard, we actually have asked our customers through a dedicated channel to provide their input in the form of agent requests. Meaning we ask the customers, if you had a chance to create an agent for your own organization, How would that look like? What business problem would it solve? We were pleased to see that we've received over 500 applications, you know, digitally for agent creation. That signaled a level of engagement in the initiative that, frankly, surpassed our expectations. Because let me say this clearly. Our audience, once again, is not sales and marketing audience. It's not IT developers' audience, where the concept of agentic, if you will, is a bit more mature. It is not yet deployed at scale by anybody. And so having this as a leading indicator was encouraging. Then we listened to our customer calls, and we understand a tremendous opportunity to solve complex, costly problems. with an agentic-first mindset. We are operating effectively as an AI company. Learning is a data mode within our strategy, and agentic is going to be the future for us.

Okay, great. With respect to the enterprise RFPs today, I'm kind of curious, is there basically sort of a shift in the market away from kind of large HCM suites and then more to kind of best-of-breed platform players like yourself. I'm just trying to understand the dynamics of that. Like, in terms of who you're displacing today, where are you seeing sort of the most momentum in terms of the segments?

So let me try to characterize this in the most simple and effective way. When we approach an organization, the ideal customer for the Shebo, it's slightly irrespective of the organization's size. I mean, the organization's size is an important leading indicator in what matters the most, which is the complexity of the learning infrastructure and operation. We have organizations with 500 employees that serve millions of users and have three, four, five hyper-complex use cases ranging from compliance to external customer use cases, partners, et cetera. et cetera. So while there is a correlation between the fact that if you are a multi-global national bank, you usually also have complexity, the opposite can also be true. Having said that, what's your comment on the migration from one type of vendor to another? Let me characterize it in this way. First, platforms, legacy platforms, there would be more point solutions in the talent world, we are winning a significant portion of business away from these vendors. Why? Because we are still very focused. We are not an HCM provider that does pay, you know, workforce time attendance and all these, you know, HR core use cases. and we combine the two things that L&D and HR cares about in a unified way. What are those two things? Learning at scales and upskilling people. We are the only enterprise provider that has the core enterprise-level technology with those two things combined. And now we've added the power of agents and knowledge management on top. That combination is unique in the market and will allow us to further accelerate taking market share away from legacy vendors in the learning space.

Okay, great.

Your next question comes from Josh Baer with Morgan Stanley. Your line is open.

Thanks for the question. I was hoping we could focus on go-to-market and sales teams. Just looking to double-click on pipeline, how that's trending, sales efficiency, sales reps, productivity, how reps are doing versus quotas, like any context that you can provide around that topic would be helpful.

A few quarters ago, we've had a shift in management. You may recall, and, you know, you guys have called out the fact that the management team at Tachebo went through a significant change. We brought in a new CMO. We brought in a new CRO. And these people are now short of a year in, some a year in. As a result of those changes, the company has matured and grown up its entire GEM execution and approach. What we are seeing are the following things. Mid-market is now, as Brandon mentioned earlier, constantly delivering for the past three to four quarters at or above their targets set internally. Very pleased with their execution, continues to grow, and I would say that is our steady beat, our bread and butter, something that we've always been good at. Just the performance has become even better thanks to great leadership across the board. Second, on the enterprise side, the enterprise side has matured. Why has it matured? It has matured because we are executing in a much more enterprise way, holistically in the company. It's not just GTM. It's combining the right things to do in GTM and product and services and customer success. The entire engine is aligned. And when you align an engine, good things happen. But enterprise cycles are 12 months. So when you start fixing things three or four quarters ago, that's when you start reaping the benefits. You don't get the benefit right away. And finally, on pipeline, demand has been the strongest we have ever seen in years. In an era in which everybody talks about SaaS apocalypse, what we're seeing is LMS and skills apocalypse on the reverse side. There is a demand that is pleasing us, a demand that is centered around the type of customers that we want to acquire. And our focus has shifted away from volume, trying to get as many organizations in the pipe, to quality. And that choice of quality pipeline is paying off in win rates and efficiency on the CAC side.

Really helpful. Maybe just one for Brandon on free cash flow was particularly strong. Anything to call out?

Hey, Josh.

From a free cash flow perspective, you know, how I always like to look at it is, you know, Over the long run, our trailing 12-month free cash flow will always be plus or minus 2% of EBITDA margins. Now, certainly, this quarter was a particularly strong free cash flow. Obviously, we can't keep up that pace quarter over quarter of having roughly 42% of our free cash flow margin. We certainly saw some one-time benefits on working capital that will normalize in Q2. So, I'd expect Q2 to be, you know, maybe even below prior year. So, there's a bit of push forward as Q1. But regardless, you know, it is a testament to the type of customers that we're acquiring that are high quality, sometimes paying years in advance. You know, we have very minimal bad debt expense. So, you know, when you're humming in the enterprise motion, you're seeing strong cash flow as well. So, very pleased with the Q1 for cash flow, but would not expect that to continue at this pace going forward.

Your next question comes from Robert Young with Canaccord. Your line is open.

Hi, good morning. Maybe a slight variation to Ryan's first question. As it relates to the sales cycle, are customers delaying decisions for AI or are you suggesting that your customers, your prospects are picking vendors that they feel can guide them through AI, i.e. they're not waiting, they're picking vendors that are best positioned? and maybe there's some pressure to update legacy platforms to position for this. Maybe you just talk about that and how the sales cycle has reacted to AI.

For sure.

So I'd say in terms of AI readiness in procurement cycles, it's not a level playing field, Meaning that different organizations are differently looking at AI as an opportunity versus a challenge. And this is the result of the current dynamics. Certain sectors, particularly the ones that are highly regulated, still operate in a conservative and somehow skeptical modus operandi relative to AI. Others, typically the more tech-forward ones, are actually taking the opposite approach. They're very AI-hungry and AI-postured, and so they are very innovative themselves. Now, how do we deal with this dichotomy? First, we have embedded into every enterprise conversation heavily the office of the CIO, and the Office of the Compliance Officer or Risk Officer. We have people that are very educated in our solution team on working with the customer through where they are in their AI adoption curve, from the most skeptic to the most innovators, and really adjust and adapt the conversation based on what is being asked. Now, is AI a show slower? Is it delaying our purchases? I wouldn't say so. You know, we have no evidence of that being a fact. What we have evidence of is there are certain organizations that when they go live, they want to take baby steps with AI. And other organizations that before they go live, they're very aggressive and want to go all in. And the good thing is we've built our AI to be very approachable. We have a control panel with full governance and controls that our customers can use. And so that's, again, part of the chops of being an enterprise-ready company, ready to approach customers at a different stage of maturity.

And then for the second question, in the prepared comments, there were some areas where you're suggesting that your proprietary data is an advantage. and particularly highlighted the external business. And so I'm trying to understand what it is about the external learning environment or that area of your business that's particularly sheltered or advantageous from AI. Is that due to the network element or is there something else there? And then I guess I'll pass the line.

Yeah, look, if you think about it in the context of we serve nearly, you know this very well, but nearly 50% of our customers use Docebo for an hybrid use case. And the reason why we call it hybrid is because there's an external component in that revenue. And so what that means is that the audiences they're serving are either customers or partners or a sub-definition of those. Now, when you think about years and years of performance of customers and or partners or distributors operating on your product, on your ecosystem as a company, imagine how important and not replicable by a non-deterministic LLM that data is. If you're running a GTM with 60,000 partners globally around the world and your entire P&L sits on the basis of their performance, wouldn't you want to know for the past three years how certain partners have performed relative to their status of certification and or qualification in your products and services? That is a vital information for any manufacturer, for any technology company that has these constituents at the base of the P&L. So can you go in the LLM and look for any of that information? You can't.

Your next question comes from George Sutton with Craig Hallam. Your line is open.

Hi, guys. This is Logan. Hopping on for George. So first one for me, it was encouraging to see in the prepared remarks. You called out those $2 million-plus deals having an average contract length of five years, which was longer than the average enterprise contract. Just hoping you could speak a little bit to what you are seeing in discussions in terms of a willingness to make some of those longer-term commitments as we think about this being an era of transformation, as you put it, Alessio. And I guess in general, have you seen any change in contract lengths being discussed, either up or down in recent quarters?

Hey, Logan. Brandon here. From an enterprise perspective, we actually saw enterprise customers signing on Doceable at an average length exceeding three years. When I look at enterprise as a total, and as you mentioned, our two largest deals of the quarter were five years plus. What we're seeing is more and more as we move up market, enterprise customers do not want to go through an RFP process every three years. If you think about an RFP process, it takes another 12 months to implement. And then once you implement, you have to run another RFP if you're on a three-year cycle. So these large enterprises, they want to lock in for five years. They do deep due diligence to understand they're going into business with the right partner. And as we move more and more upmarket, we're seeing more and more five-year deals.

I do expect that to continue.

And second one for me, Alessio, it's interesting in the prepared remarks, you called out a few times how companies on a standalone basis are paying a lot right now for some of the value that you're starting to provide with things like enterprise knowledge and agent hub. Just curious, as you go down this road of building out AI functionality, at what point are you kind of earning the right to get paid on that? Or, like I said differently, how should we think about monetization following the value that you're providing with these AI products?

The objective number one is increasing moat and making Docebo unique and hyper-differentiated in what, just for a point of clarity, was our market, what was our sole market not too long ago, the LMS market. An historically unfavored and hyper-commoditized market, a market with a lot of players with comparable capabilities. Our strategy has been adding value on top of that core in order to continue our process of differentiation for who? for the complex use cases organization, for the enterprise type usage. And so that's been at the very core of our strategy. When it comes to monetization, no doubt our objective is to continue to increase our right to win. And I believe that as we add these capabilities, the premium that we can command is a consequence, is the right consequence of our positioning in the market. It is to be expected that the premium for the Docebo workforce readiness, meaning the combination of the learning platform, the skills platform, the knowledge management platform, and products that are soon to come in 2026-2027, which we will announce at the proper time, I believe that our right to win and the right to continue to increase our new logo dollar per new customer will continue to increase. And by the way, quarter one, 2026 recorded a record dollar in that regard.

That trend has already started.

Thank you.

Your next question comes from Matt Van Vliet with Cantor. Your line is open.

Yeah, good morning. Thanks for taking the questions. I guess as you look at the first step on achieving FedRAMP and ultimately sort of what that unlocks with the product roadmap, I'd be curious on what the pipeline looks like over the next few months as we head into the September fiscal year end for the U.S. federal. and then you obviously called out a state deal. Like how that's playing out in the broader public sector, go-to-market organization?

So we started our federal journey and flat journey before then. I'm also pleased to say that we have recently renewed our FedRAM certification, There is subject to yearly review. That was a very good accomplishment. And our pipeline in the government space, the combination of federal and state and local, or we refer to it as SLED, continues to grow very, very significantly at and above our expectations. The sales cycles for federal, as you all know, skew towards the quarter three. And so, you know, while that timeline is not immediate, what we look at are the deals, material that exists in that court, and that we're working closely with our partners. Partners play a huge role for the federal execution of GTM. Partners like Deloitte are critical in that execution for us. And, you know, I can say confidently that we love the deals that we have in, and federal deals have the behavior of being lumpy, meaning they are less units, but they're bigger units in dollar value. This is edged and counterbalanced by the opposite behavior on the slide side. More volume, still very healthy, but significantly smaller tickets. And on both ends, our pipeline is healthy and getting better. Frankly, because we're getting better ourselves, we're growing our team, we're ramping our sellers, we're ramping our partners, we're ramping our business development efforts. So I feel like we are not at the beginning, but not yet in the full maturity of the journey of GTM government. And I think age 2, 20, 26, and 20, 27 are going to be meaningful for us.

Very helpful. And then you obviously completed the previous share repurchase, and it looks like there's a new authorization. Curious on how that plays into your overall capital allocation strategy and maybe where M&A continues to fit in there or any timing and thoughts around what might still be left to acquire to build out the platform while balancing it with other capital needs.

As you know, we have a three-pronged capital allocation approach. Number one, investing back in the business. Number two, share repurchases in three. On share repurchases, we did repurchase a significant amount of shares, both through the SIB and the NCIB. As we look at the valuation on our shares, we will continue to buy back shares as long as we see attractive valuations, which we do believe is today. From an M&A perspective, listen, we've done two M&A over the past four months. You know, M&A is, you know, as you know, inherently risky, and we really want to focus on execution. You know, M&A, there's two types of M&A. One is opportunistic, you know, a compelling asset comes in the market, and sometimes you have no option to look at it and acquire it. Another one is, you know, you have a gap or a need, and you're going out into the market. Right now, opportunistic M&A could be an option. It's always an option. You can never say never opportunistically. But if I had to say, will we acquire another asset in the next three quarters, the likelihood is low. We think we have the right assets in place. We think we have the right platform in place. We have the right product strategy. And we want to focus on execution.

Your next question comes from Sutan Sukumar.

with Stiefel. Your line is open. Good morning, gents. For my first question, I wanted to touch

on the current upsell motion and kind of priorities here. Given the expected fall GA date for agent hub and enterprise knowledge, what are some of the key upsell levers you guys have in the sales motion in the meantime? And more broadly, I guess, do you still expect the typical back-ended strength for enterprise procurement this year, or given the strength that you're seeing now in Q1, do you expect that to be more even-paced?

On the expansion side, in Q1, we actually had a very, very strong expansion quarter, one of the strongest ever. When you think about the levers of expansion we have at the moment, number one, 365 Talents, completely new product. Number two, use case expansion. If you think about one of our largest deals this quarter with a regulated broker, we won the logo in Q4 on an internal use case. We did such a good job from a pre-sale motion, implementation motion. In Q1, we landed the external use case. That is always going to be a big expansion driver for us. You know, as we look out to H2, as you mentioned, there'll be additional expansion levers. From an enterprise perspective, you know, there's always going to be lumpiness. I would always expect Q4 to be our strongest ARR quarter that will continue in 2026. At the same time, we're just, you know, we're seeing strong demand and Q1 was strong

enterprise. Okay, great. Thank you. And second question, I wanted to double click on the five your terms that you're seeing with some of the larger deals this quarter, you know, I guess there are kind of pros and cons with, you know, with the short-term versus long-term But, you know, on these long-term deals, do you still have the same or greater opportunity to upsell and expand over the duration of these terms?

I mean, listen, you have the, you know, with any term of a customer, they're locked in. And as we add new modules and new products, those are expansion opportunities. And also, if you think about external use cases or internal, as the company grows, either through headcount or through customer growth, that leads to more registered users that may use whatever their pricing model is. So as Docebo adds more modules to our product suite or becomes a bigger multi-product company, that is going to continue to increase our expansion levers.

Thank you.

Once again, if you have a question, it is star one. Your next question comes from Ken Wong with Oppenheimer. Your line is open.

Thanks for taking my question. Alessio, I wanted to circle back to the federal SLED pipeline. It's great to see the interconnectivity between Fed and SLED deals that you mentioned in your prepared script. As you look at your pipeline, do you have other interwoven deals here where one piggybacks on top of the other, so we have to wait for some sort of a sequencing for one to come out before you can maybe close some of the other deals? What's that particular conversion funnel look like?

I'm so sorry. I didn't fully catch that, Ken. Would you mind going one more time?

So, yeah, I'm just wondering in terms of your deal pipeline, are you seeing other deals that are somewhat connected with one another where it looks like the Department of War was able to kind of bring in the, you know, the Connecticut deal, the Utah deal? Is that a very similar, you know, type of framework as we think about the deals in your pipeline where one might depend on another one closing first?

Hey, Ken, I don't know if it depends on one closest first, but I think it is an expansion lever. So, for example, if you think about the state of New Jersey, we have a contract with the transit department. And once you get in with a state in one lever and you have champions within that department, it becomes easier to expand within that different state. And I'll give you one example. In one state, we have a correctional facility. as a customer of ours, and they're introducing us to a correctional facility in a different state. So I think it's a matter of, you know, the more customers we have in this led space, the more we could use that cross-sell motion. But I wouldn't say there's interdependencies where we have to close one before we can close the other.

Understood. Appreciate the clarity there. And then, Brandon, just in terms of the guidance, I just wanted to kind of think through Q2 a little bit. I guess on the surface, it looks like perhaps sequentially a little, you know, slightly sub-seasonal. Any comment on, you know, whether there's incremental conservatism or perhaps just some context on the shape of the pipeline conversion that might be baked into the 2Q four-year guide?

Yeah, and then, you know, just, you know, important to take a step back a little bit. So we did raise our guidance from a revenue perspective by about $3.5 million. 2.2 of that came from the Q1 beat. So we're still not only raising our annual guide by the Q1 beat, but flowing strength throughout the rest of the year. You know, as we mentioned, you know, Enterprise had an exciting Q1, but we're still being conservative in Q2 and Q3 just based off of prior experience. and we want to see a couple of quarters of strength before we call it a trend. But we're definitely seeing strengths throughout our segments, whether we talked about the near or mid-market, and seeing good traction in the government space on SLED and Q2. So we're really kind of keeping with the core assumptions that we had last quarter with tweaking and increasing on our confidence from the pipeline.

Fantastic. Thanks very much.

Thank you.

Your next question comes from John Schau with TD Cowan. Your line is open.

Good morning. Thanks for taking my question. I want to ask about data threats because it looks like that this is the kind of customer that will want to build their own platform given they have the talents and resources, but that clearly did not happen, and they're actually doing more with you guys. So just curious what happened behind the scenes and any color on this customer decision-making will be helpful.

Thank you, John. I think we're first super proud and grateful to Databricks, a great partner, a great customer that's been with us for a significant amount of time and has grown in its adoption and use of different whichever products and modules over the years. And I don't have difficulty in saying it's a really great story of execution and establishing a relationship of partnership as opposed to vendorship, as I was mentioning in the beginning of this earnings call. And so, you know, I'm very proud of that. But it's also, you know, it always takes two to tango. And in the case of Databricks, it takes a customer that is, you know, very strategic and determined to accomplishing what they know they want and looking for that. And so I believe we've responded to their needs in the right way and showed them true partnership. And as far as building versus buying, you know, look, this is one of the, you know, some of the smartest people in the tech world. and they've opted for Decebo as their learning technology partner and recently upgraded to use 365 as their skills platform. And that, to me, says a lot about, once again, the strategy that we've put in place, which is equipping enterprises not just with the learning aspect, but also with the talent aspect that really creates a unique combination. And this was proof in our strategy. It was a great execution. It was a sharp, fast sales cycle. And so, you know, it was a little bit of a test bed for us of our thesis. around the 365 expansion strategy for the quarters to come.

That's great, Collar. I also want to ask about the mix between external training versus internal. I know right now it's roughly 50-50, but as you continue to go after large enterprise with more complex use cases, where do you think this number will eventually land?

Let me first be clear.

Half of our audience is hybrid And it's an even stronger metric Meaning that we have more than half of our customers That are using the Chable for multiple use cases Across both the internal and external use case Not just the external use case Secondly, I would say There is no specific change in our strategy that leads us to believe that this mix will change dramatically in the short time frame. Our fundamental strategy in terms of product mix and target audiences is not changing. It's strengthening because we're adding products to address these audiences. Now, the trend we expect naturally is that the hybrid portion over the years will continue to increase because our goal is to convert as many customers that are either only internal or only external to adopt Locebo or products of Locebo for more than one audience use case. That's the upsell motion that Brandon was referring to earlier. But we like this mix, and we continue to execute in accordance to what we've done so far.

Great. Up the line.

Your next question comes from Gavin Fairweather with ATB Cormark. Your line is open.

Hey, good morning. One of you now is 365 Towns. The initial cross-sell conversation is largely around internal, but it's pretty clear from Connect that there is an external play here also. Curious if there's any product work needed to open that up and if you're getting any early feedback from clients that's informing their view on that opportunity.

Super smart question, Gavin. I love it because you should know that I've always had a big passion since 2014 in transforming our business at Tochebo from an internal-only business to what it is today, an hybrid business. So I know that story really well from having done it here. And when I first looked at 365 as an asset, an asset that had the majority of its success, on the internal side, when I met the founders, I said to them, I bet you that is a very strong play for external here. And they had some proof in that, some customers that were using it on the external side. But it was not the majority. And I thought that was a huge opportunity. We continued to develop that conversation. We looked at the roadmap in that regard, and then we started doing what I think the best companies do, listen to the customers and listen to the leading indicators. At the Chebu Inspire, at our conference with more than 1,000 people, half of that audience showed up at the 365 booth. And you know what more than half of that audience said? We'd love to know how we can use skills in an external use case scenario. So what we've continued to do is to advance our thoughts on that roadmap, and you're accurate in inferring that there should be some light product adjustments to support the skills relative to external use cases as opposed to internal. So we are on that journey, and we believe it will strengthen even further our hybrid play.

Thanks so much. I'll pass one.

This concludes the question and answer session. I'll turn the call to Alessio for closing remarks.

As we continue to build Docebo as an AI company with learning and knowledge and skills at the center of it, we remain not just excited, we're thrilled about the opportunity I had. We thank you for the time today, and we look forward to the next call.

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