Greetings, and welcome to the Tenable First Quarter Earnings Conference Call. This conference is being recorded. It is now my pleasure to introduce your host, Erin Karney. Thank you, Erin. You may begin.

Thank you, operator, and thank you all for joining us on today's conference call to discuss Tenable's First Quarter 2021 Financial Results. With me on the call today are Amit Yoran, Tenable's Chief Executive Officer; and Steve Vintz, Chief Financial Officer. Prior to this call, we issued a press release announcing our financial results for the quarter. You can find the press release on the IR website at tenable.com. Before we begin, let me remind you that we will make forward-looking statements during the course of this call, including statements relating to Tenable's guidance and expectations for the second quarter and full year 2021; growth and drivers in Tenable's business; changes in the threat landscape in the security industry and our competitive position in the market; growth in our customer demand for and adoption of our solutions; the potential benefits of the acquisition of Alsid; planned innovation and new products and services; Tenable's expectations regarding long-term profitability; and the impact of COVID-19 on our business and on the global economy. These forward-looking statements involve risks and uncertainties, some of which are beyond our control, which could cause actual results to differ materially from those anticipated by these statements. You should not rely upon forward-looking statements as a prediction of future events. Forward-looking statements represent our management's beliefs and assumptions only as of today and should not be considered representative of our views as of any subsequent date. We disclaim any obligation to update any forward-looking statements or outlook. For a further discussion of the material risks and other important factors that could affect our actual results please refer to those contained in our most recent annual report on Form 10-K and subsequent reports that we file with the SEC, which are available on the SEC website at sec.gov. 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. There are a number of limitations related to the use of these non-GAAP financial measures versus their closest GAAP equivalent. Our earnings release that we issued today includes GAAP to non-GAAP reconciliations for these measures and is also available on the Investor Relations section of our website. Before I turn the call over to Amit, I want to quickly bring to your attention the corporate social responsibility report we recently published to support our environmental, social and governance initiatives. The report can be found on our Investor Relations website. With the direction of our Board of Directors, executive leadership and other relevant parties, we pooled internal and external sources to do a deep dive into our ESG practices. We are very excited about the results and encourage you to take a look at the published report. I'll now turn the call over to Amit.

Thank you, Erin, and thank you all for joining us today. First, I want to say that we're very pleased to announce the closing of our acquisition of Alsid and welcome the Alsid team to Tenable. We'll talk more about Alsid after a quick review of the quarter. Today, I'll highlight our strong Q1 results, the rising importance of Cyber Exposure and our holistic approach to our portfolio, including Tenable.ep and our new Active Directory solution, Tenable.ad, and new partnerships we've added that we think further validate our market leadership and strengthen our ability to assist customers with rapid remediation. With that, let me first touch on our Q1 results. We are off to a great start for the year as reflected in our compelling Q1 results. Our calculated current billings and revenue each grew 20% year-over-year, driven in part by recent cyber incidents, the acceleration of shift to cloud and growing cross-sell opportunities. We also had strong free cash flow in the quarter, so an expansion of our non-GAAP operating margin and had an $0.08 beat in EPS. Steve will discuss the quarter in greater detail, but we feel these results put us on a solid footing to have a very successful year and are a reflection of the growing demand for our solutions and our attractive business model. Recent high-profile breaches have highlighted the need for comprehensive vulnerability management and an understanding of where exposure exists to enable attack disruption and facilitate informed incident response. VM and Cyber Exposure play a central role in providing broad visibility into the attack surface. What Tenable offers, the continuous dynamic monitoring of assets and user permissions, along with the means to prioritize remediation based on risk is more important than ever. Key highlights from the quarter are continued traction in cloud and cross-sell, including contribution from Tenable.io and the launch of Tenable.ep. Tenable.ep is a new go-to-market motion across our platform of products that includes Tenable.io, Lumin, web app security and Container Security. In addition, with the closing of Alsid, we have simultaneously launched Tenable.ad, a solution designed to audit and monitor Active Directory security and disrupt identity as an attack path in both advanced persistent threats and common hacks. Our customers recognize that as the attack surface continues to expand, a holistic approach to Cyber Exposure is the most effective way to measure, prioritize and manage risk. I'd like now to talk about Tenable EP. Given the momentum of our solutions, we're looking for new ways to deliver more leverage to our customers and make it easier for them to benefit from the full suite of our capabilities. In Q1, we announced Tenable.ep, enabling customers to use more of Tenable's capabilities in combination as a unified platform. EP enables our customers to effectively assess the moderate attack surface by combining VM, web app, Container and Lumin in a unified platform and allows customers to dynamically allocate licenses across all asset types according to their needs and modify as their environment changes. This gives customers flexibility to take a holistic rather than piecemeal approach to assessing the exposure and then prioritize the results through Lumin to obtain recommended actions based on risk. Tenable.ep was made available for sale in late February, and I'm very happy to say that we're seeing really good adoption and interest from our customers. A great example of this is a competitive takeaway with a global customer. This customer had been actively seeking a combination of Tenable.io, Container and Web App Security to improve visibility. In addition, we're able to show the value of Lumin, which became the key differentiator from a technology perspective. EP provided the unified platform they needed for both the short and long term. The result was a six-figure Tenable.ep win. We're enthusiastic about the meaningful early wins and the growing pipeline we are seeing with EP. In addition to momentum in Tenable.io and expansions from frictionless assessment, we expect Tenable.ep to advance our role in securing our customers' cloud deployments. Now onto our very exciting acquisition of Alsid. We are thrilled to announce the closing of Alsid and simultaneously launched Tenable.ad, our new Active Directory security solution. This solution is designed to secure Active Directory environments and disrupt adversary attack paths. AD environments are incredibly complex and are a top concern for many of the CSOs we speak with. Tenable.ad provides insights into the weaknesses in Active Directory deployments and identifies misconfigurations that can be used to elevate permissions and create persistent access. AD is the basis for managing user permissions across on-prem and hybrid cloud deployments. It is foundational to the security of cloud workloads, security of remote work and adopting Zero Trust architectures. We're excited to expand our cyber exposure solution and advance our cross-sell opportunities to include this capability. In summary, we see strong momentum and expanding use cases for our broader platform of products. Recent events such as the security breaches in water facilities in Florida and Kansas highlight the need for proper cyber risk management, especially in the operational technology sector. This has been further emphasized by the recent presidential executive order on understanding vulnerabilities and securing bulk power systems. As part of the critical infrastructure supporting the global pandemic, a large multinational medical device manufacturer required visibility into their production assets to better understand and manage their risk. Partnering with a global advisory, Tenable offered a unique differentiator across both IT and OT. We remain excited about the opportunity to help enterprises understand and manage their OT risk. Across our portfolio of products, our platform enables customers to take a holistic continuous approach to managing risk. Our offerings deliver differentiated solutions designed to answer the fundamental questions of: How exposed am I? How at risk am I? And what should I do about it? Now at Tenable, we talk a lot about the importance of being best-of-breed. This approach and differentiated capabilities help us forge stronger partnerships and an expansive ecosystem. We had two particularly exciting partnerships solidified during the first quarter. We're excited about our new partnership with IBM, where we're a preferred partner for fully integrated vulnerability insights native within IBM SIM. IBM chose Tenable as a preferred partner due to our technology leadership, including covering more vulnerabilities and providing both on-prem and cloud-based offerings, ease of transition and our market leadership. We also announced our new partnership with HCL BigFix, a leading endpoint management platform, making it easier for our customers to automate remediation using infrastructure platforms they've already selected. In summary, we're off to a great start for the year, and we're excited about our outlook. Our portfolio creates a compelling way to measure and manage risk. We believe foundational drivers like digital transformation, the shift to cloud and Zero Trust will continue to fuel long-term success in our business.

Thanks, Amit. As Amit mentioned earlier, we're very pleased with our results for the first quarter, highlighted by attractive top line growth, a sizable beat in non-GAAP EPS and exceptional free cash flow, which is a testament to the inherent operating leverage in our recurring revenue model. I'll discuss our results for the quarter momentarily. But first, please note that all financial results we will discuss today are on a non-GAAP financial measure basis, with the exception of revenue. As Erin mentioned at the start of this call, GAAP to non-GAAP reconciliations may be found in our earnings release issued earlier today, which is posted on our website. Now on to our results. Revenue for the quarter was $123.2 million, which represents 20% year-over-year growth. Revenue in the quarter exceeded the midpoint of our guided range by approximately $4 million. Our percentage of recurring revenue remains high at 94%, which is primarily a result of our annual prepaid subscription model. Revenue in the quarter was aided by strong demand for both new and renewal business. In terms of new business, we had 331 new enterprise platform customers, which is up from the 319 we added in Q1 of last year. Of particular note, this is the first quarter since the start of the pandemic in which new enterprise platform adds are up on a year-over-year basis. In terms of large deals, we added 29 net new six-figure customers in the quarter, which is also up year-over-year. This brings the total number of customers spending in excess of $100,000 annually to 866, a 30% increase year-over-year. This demand is also reflected in our calculated current billings. CCB, defined as the change in deferred revenue plus revenue recognized in the quarter, grew 20% year-over-year to $119.5 million. As Amit highlighted earlier, we attribute the strength in the top line to the growing importance of Cyber Exposure, further accentuated by recent SolarWinds and Microsoft attacks. Cyber Exposure is also a key component of digital transformation, which continues to be a top priority for many organizations. While some of our customers took a measured pace of investment last year as a result of the pandemic, we are starting to see early indications of a stronger spending environment attributed to pent-up demand. Some early indications of this demand surfaced in Q1 in our middle market business, where sales cycles tend to be much shorter compared to those in the large enterprise market. The good news here is that enterprise performance was strong in the first quarter and has healthy pipeline and activity levels that could potentially further benefit from this trend. It's also worth noting that we're seeing an accelerated adoption of Tenable.io and associated add-on modules that is positively impacting our cross-sell efforts, which will be further rated by the launch of Tenable.ep, which commands a notably higher selling price versus our core VM offering. This also positively impacted our net dollar renewal rate. I'll now turn to operating expenses, which include incremental investments, offset in part by continued efficiencies in our business. I'll start with gross margin, which was 83% this quarter and 84% last quarter. Our gross margin continues to be very healthy and reflects increased investment in our public cloud infrastructure to support a broader set of predictive analytics and a more expansive data lake. As a reminder, we plan to continue to make incremental cloud investments throughout the year, including all said related costs. As such, we expect our gross margin for the full year 2021 to moderate by approximately 100 basis points, reflecting higher cloud adoption. Sales and marketing expense for the quarter was $52.3 million, which is up from $50.8 million last quarter. Sales and marketing increased sequentially, primarily due to incremental investment in demand generation activities and sales headcount-related costs, including an increased number of quota-carrying sales reps. This quarter represents the second consecutive quarter of increased sales and marketing investment, which we attribute to the increasing confidence in our business and a broader base of demand with the pandemic starting to abate. Despite the higher levels of investment, sales and marketing expense as a percentage of revenue was approximately 42% or 50 basis points better than last quarter. R&D expense for the quarter was $22.7 million, which is up from $20.4 million last quarter. As a percent of revenue, R&D expense was 18% compared to 17% last quarter. Given our best-of-breed approach, innovation remains a top priority, and we plan to continue to invest throughout the year. G&A expense was $13.7 million compared to $12.5 million last quarter. As a percent of revenue, G&A expense was 11% this quarter, which is flat compared to last quarter. Income from operations was $13.9 million in Q1 compared to $15.4 million last quarter. Operating margin was positive 11% for Q1 compared to positive 13% last quarter. I'd also like to provide some commentary regarding the tax provision. As a reminder, our Q1 outlook provided in February assumed a non-GAAP tax provision of $1.5 million. However, discrete benefits recognized in the quarter in foreign jurisdictions that were previously not contemplated actually swung us to a non-GAAP tax benefit of approximately $1 million. Now all of this resulted in significant EPS upside for the first quarter as our non-GAAP earnings per share was $0.13, which was $0.08 better than the midpoint of our guided range. The beat was a combination of better-than-expected top line results, good cost management despite the incremental investments in our business and the discrete tax items I just mentioned. Now let's turn to the balance sheet. We finished the quarter with $340 million in cash and cash equivalents and short-term investments, an increase of approximately $48 million compared to last quarter. Total deferred revenue at March 31, 2021, was approximately $429 million, giving us a lot of visibility into revenue headed into Q2 and the remainder of the year. Turning to cash flow. We generated $37.6 million of positive free cash flow in the quarter, which compared quite favorably to free cash flow of $3.9 million in Q1 last year. Over the last 12 months, we've generated approximately $78 million of positive free cash flow. With high recurring revenue, high gross margins and high renewal rates, we feel confident that we can continue to generate attractive levels of free cash flow while continuing to invest in the business. That said, Q1 does tend to have higher collections given the seasonally strong bookings in Q4. So free cash flow is expected to moderate in Q2. Plus we will have the acquisition-related costs and the incremental OpEx associated with Alsid. This is all expected to result in modestly positive free cash flow in Q2 with higher levels in the second half of the year. With the results of the quarter behind us, I'd like to discuss our outlook for the second quarter and full year 2021. While our assumption is that the health crisis will continue to create some uncertainty, our strong start to the year gives us greater confidence in the business environment now versus last quarter. I'd also like to provide some commentary on Alsid, which closed yesterday. When we announced the acquisition in February, we indicated that Alsid would add 1 point of incremental CCB and revenue growth and $15 million to $20 million of incremental OpEx for the remainder of the year. Our outlook for Alsid today has not changed. In Q2, Alsid is expected to have minimal CCB and revenue impact, given sales cycles and the write-down of the acquired deferred revenue, while operating expenses will include two months of activity. With that said, I will review the outlook for Q2 and the full year 2021. With the second quarter, we currently expect revenue to be in the range of $124 million to $126 million. Non-GAAP income from operations to be in the range of $7 million to $8 million. Non-GAAP net income to be in the range of $5 million to $6 million, assuming a provision for income taxes of $1.5 million. Non-GAAP diluted earnings per share to be in the range of $0.04 to $0.05, assuming 114.5 million fully diluted weighted average shares outstanding. And for the full year, we currently expect calculated current billings to be in the range of $575 million to $585 million. Revenue to be in the range of $520 million to $524 million. Non-GAAP income from operations to be in the range of $34 million to $38 million; and non-GAAP net income to be in the range of $28 million to $32 million, assuming a provision for income taxes of $3.5 million. Non-GAAP diluted earnings per share to be in the range of $0.24 to $0.28, assuming 115.5 million fully diluted weighted average shares outstanding. As a matter of clarity, the guidance we are providing today reflects not only the expected contribution from Alsid, but also our Q1 beat and a $1 million improvement in revenue and a $0.02 raise in EPS for Tenable on a stand-alone basis. In summary, we're pleased with the results of the quarter, which gives us increasing confidence that we remain well positioned to deliver compelling growth and profitability over the long term. And now I'll turn the call back to Amit for some closing comments.

Thanks, Steve. As I stated earlier in the call, recent security events and digital transformation have raised the profile of Cyber Exposure. These events prove that we can't rely on strong perimeter defenses and have highlighted the need for assessing risk across the entire enterprise. Our message has been very consistent. For Tenable, our core strength in understanding cyber risk has driven our success. Its aim is on natural expansion across the surface of attack into improving the security posture for cloud and OT deployments. Our strengthening platform of capabilities positions us for long-term success as our customers shift from hybrid and cloud environments. We hope to see many of you virtually at the JPMorgan, Needham and William Blair conferences in the coming weeks. We now would like to open the call up for questions.

Our first question comes from Brian Essex with Goldman Sachs.

Congrats on some nice results. Amit, I was wondering if maybe you could start with a little bit of color. I think Steve pointed to, in his prepared remarks, strong momentum in expanding use cases and some pent-up demand. Where exactly are you seeing that? And maybe the outlook as particularly with regard to change in velocity of the sales cycle and how things might change given a return to office of some of your enterprise customers?

Thanks, Brian. We're witnessing demand mainly due to digital transformation. Earlier in the pandemic, there was a significant shift to remote work, which has led to an accelerated adoption of cloud services and a growing recognition that this is the new operating environment. As a result, the security teams are now working to catch up and understand the risks associated with operating in these environments. This has contributed to an acceleration in our business, and I believe it accounts for the strong growth we've seen over the last few quarters, particularly in cross-selling opportunities across our product lines. Companies are not just relying on traditional virtual machines or risk-based virtual machines; they are actively using our technology to better understand their exposure and risk.

Got it. Maybe can you point to the sales cycles, how they might be changing? And it looks like sales and marketing was quite a bit more efficient than we had anticipated in the quarter. Where did that greater efficiency come from? I guess in spite of perhaps incremental sales, head adds?

Hey Brian, this is Steve. A couple of things I mentioned there. First and foremost, we're delighted with the results in the first quarter. We grew CCB by 20% as well as revenue and delivered sizable beats in EPS and had record levels of free cash flow. In terms of demand, we did see, as Amit commented earlier, strength across the board, both domestically and abroad, in the large market as well as the mid-market where we called out that, that was an area of outperformance. We've previously disclosed that the mid-market represents about 25% of our total sales. And as a reminder, we have a very compelling go-to-market model where we have a product in Nessus that had broad adoption and use across the mid-market as well as large, and the ubiquitous nature of Nessus has created a cost-effective one ramp for us. In Q1, we saw some really good pull-through in the mid-market from the flywheel effect of Nessus, channel and MSSP also played a role and contributed. Sales cycles are more modest in the mid-market versus that in the large. And so some of the things that we're seeing here out of the gate in Q1 have bode well, not only for the mid-market, but we also think it's encouraging potentially for other larger deals down the road. So pleased with the performance on not only in the mid but also large in Q1, and there are some really early signs that demand will potentially remain healthy throughout the year, which has given us the confidence to raise our outlook for both CCB and revenue for the full year today.

Our next question comes from Sterling Auty with JPMorgan.

So it's very clear that the tone has changed dramatically since last quarter. And you've highlighted a number of factors to it, including your answers to Brian. But maybe just kind of rank order what you think the biggest differences are, from what we were talking about just a quarter ago in terms of the pent-up demand and all the other reasons? Just what are having the biggest influences in the change?

Hey Sterling, it's great to hear from you. I would describe things a bit differently. We were quite optimistic going into the year, noting the potential we saw and the signs of a strong year ahead. However, we are still amidst a global pandemic, facing significant uncertainty and a turbulent political climate coupled with a lot of market sell-offs this year. So, we are very pleased with how the quarter unfolded. We saw continued growth throughout the quarter, mostly due to customers adapting to a new environment that demands more complex technology management. They understand the need to embrace virtualization to maintain agility in response to major incidents, while also getting a grasp on cloud infrastructure, web applications, and DevOps settings. This shift has started to be reflected in the increased costs for new products. We believe this momentum will keep building as we establish a solid foundation with Tenable.ep.

That makes sense. And then one quick follow-up. You mentioned that EP, the pricing and, it has potential for larger deals. Any sense even with some of the couple of early wins that you had, how much different should we think about the average deal size and revenue run rate from customers on EP versus your traditional deals?

Yes, so... Amit, maybe you can provide further context. But just in terms of the pricing, there's a notable uplift with EP. It's very much an enterprise solution. And so EP is priced at a premium relative to core VM as well as core VM plus Lumin. And it includes a broader set of capabilities to address risk holistically across the enterprise. It includes VM, Lumin, Container and WAS. And out of the gate, we're very pleased with our progress activity levels. And interest remain very high, and we think this is certainly going to be helpful in our efforts to sell our very broad product suite into the enterprise in a more effective way. At 60% uplift relative to what we see with core VM, to answer your question.

Our next question comes from Hamza Fodderwala with Morgan Stanley.

First question for you. You mentioned strong momentum with Tenable.io. Could you provide some details on the early momentum with the frictionless assessment since you announced it for AWS? How has that been trending? What do you see as the potential opportunities here compared to the traditional VM spending you've observed in the past?

Yes, we are very encouraged by what I would describe as early successes and strong interest. The frictionless approach complements how people secure their cloud workloads effectively. In many cloud environments, assets can be very temporary, lasting hours, days, or weeks. However, these types of systems are not managed in the same way as long-term infrastructure usage. In many cases, deploying agents doesn't make sense, and this frictionless method provides the best way to gain a deeper understanding of your assets and their exposure levels. We believe it aligns perfectly with our efforts related to container security, web app scanning, and the cloud-native connector. While deploying agents can be beneficial in some parts of the environment, frictionless offers a rapid, zero-touch way to assess exposure and risk in others. We have seen several early victories, and momentum continues to grow with this product. We are quite optimistic about its future potential.

Yes. And just a brief follow-up on that for Steve. I guess as you guys sort of focus on an expanding number of assets within your existing enterprise base, I'm wondering what are the dollar retention rates been looking like in Q1 relative to what you've seen in the past? I think it's sort of in 110% plus? Any sort of change there?

Cross-selling was robust in the quarter and contributed to an increase in our net dollar renewal rate, as I mentioned earlier. This follows a very solid cross-sell effort in Q4. Products like Lumin and OT are significant components of this success. We are not only selling these products individually but also integrating them into our core VM offering and the broader exposure platform we talked about earlier. We're happy with the levels of cross-sell right from the start. Cross-selling comes to us through both products and expanded asset coverage. We previously discussed performance in the mid-market and the flywheel effect of Nessus. Much of the growth came from upselling Nessus into the enterprise platform, and our mid-market efforts were bolstered by increased asset coverage. Overall, growth appears to be progressing positively for us at the beginning of Q1, and we're off to a strong start.

Our next question comes from Daniel Ives with Wedbush Securities.

So can you just walk through your view on the federal side, here especially given everything we've seen there in your exposure? I mean, what are you seeing from a pipeline perspective and just view of deals going into the next few quarters?

Yes. Thanks, Dan. As you know, we have an exceptionally strong position in the federal market. Federal market has always been a very healthy part of our business. And we see very positive signs with respect to the overall federal approach to cyber. We've seen a Presidential Executive Board recently that called out, assessing vulnerabilities and securing bulk power. And we've seen an increase in funding for not only IT modernization, which obviously Tenable could play a role in, but also funding specifically for CISA, where the CDM program, and Tenable's a significant participant, a significant component of the CDM program funding there. So we're encouraged by what we see. Nothing, I think in the federal space moves extremely fast. But we have a strong installed base. We have strategic relationships where we're providing a vital function and believe that they will continue to be strong opportunities for us to grow in the federal space in the coming periods.

Great. And then, so just when you talk about Lumin, obviously, I think we've seen in the last few quarters it just become more and more of a driver. Does that change even who you're selling into with an organization? Like is that, is that much of a door opener now that is really starting to hit its stride?

Yes, definitely. If we look back a couple of years, Tenable focused on delivering a superior vulnerability management experience, resulting in better coverage, accuracy, and outcomes for our customers. We've committed to not just providing better data, but also enhancing our analytics. This includes prioritizing vulnerabilities and integrating this approach into our core products, helping customers see Tenable as a strategic partner in their programs, rather than just a source of tactical information. With Lumin, we've elevated our discussions with enterprises to address not only exposure but also risk, comparing their hygiene and program maturity to their peers. These conversations touch on critical aspects related to standards of care and negligence, which resonate with CISOs, Audit and Risk Committees, CEOs, and Risk Officers. This shift has allowed us to engage in much more strategic dialogues with our customers. Additionally, it sets a strong foundation for our current work with EP, which aims to expand visibility into insights beyond traditional infrastructure to cover a broader range of their attack surface.

Our next question comes from Jonathan Ho with William Blair.

Congrats on the strong quarter. I just wanted to start out with some of your comments around recent breaches and how is this maybe translating into either deal activity or pipeline?

This is Steve. I'll jump in here. We are very encouraged with what we're seeing early on. There are clear indications that some of our customers are increasingly focused on digital transformation this year, with greater attention and investment. We believe this trend has been further emphasized by high-profile, sophisticated attacks in a more complex threat environment. Additionally, there are early signs of pent-up demand in certain segments of our customer base. For instance, during the pandemic, investments in digital transformation were primarily directed towards connectivity and collaboration, essential for remote communication and work. As the pandemic has progressed and begun to abate, we are noticing that many of our customers are renewing their focus on digital transformation and resuming some activities that may have been put on hold. So, while it's just one quarter, there are encouraging signs, and we think the demand dynamics in Q1 are strong, potentially setting us up for a good 2021.

Got it. And then just relative to the Tenable.ad product, can you talk about how this maybe fits within the portfolio? And does Tenable.ad also help you to sell your existing products as well?

Tenable.ad aligns perfectly with our overall vision. Our aim is to help customers understand their attack surface and identify areas of exposure. This ultimately assists them in assessing their risk levels and determining which actions to take for optimal risk reduction. Active Directory has increasingly become a primary target for adversaries, whether they are sophisticated attackers or foreign intelligence services. Once access is gained, the goal is to escalate privileges, move laterally within the organization, and establish persistence. Securing Active Directory in an enterprise environment is quite challenging, making it a prime target for attacks. Therefore, the ability to thoroughly assess and audit a sophisticated Active Directory setup is crucial for identifying vulnerabilities and tightening security measures. Ongoing monitoring for high-risk activities, such as the creation of privileged accounts or new trust relationships, is equally important. This capability is a key part of our strategy, as it enables us to identify which systems have vulnerabilities and prioritize them accordingly. We are committed to assisting our customers with these insights, recognizing the significant need for enhanced security capabilities within enterprises, and we are enthusiastic about the opportunities ahead.

Our next question comes from Andrew Nowinski with D.A. Davidson.

Congratulations on a strong quarter. I have a question regarding competition and a follow-up. We observed an increase in Rapid7 displacements in our channel survey this quarter, which seems to correspond with your comments on the mid-market business performance. Could you provide more insight into that competitive landscape and whether you're noticing any shifts in win rates regarding the competition?

As you mentioned, we highlighted our strong performance in the commercial market. There hasn't been any significant change. We have consistently competed well against both Rapid7 and Qualys and continue to do so. Therefore, there isn't a notable change to report. However, we did experience an increase in sales in the commercial market this quarter, which I believe is partly due to SolarWinds' response and recognition of need, along with previous underspending during the pandemic.

Okay. Got it. And then maybe a question for Steve. You had very consistent growth in your current quarter billings, and it was in line with revenue growth. Looking ahead to Q2, Q3, and Q4, you have relatively easy comparisons for the rest of the year. What are you considering in your guidance for the full year that suggests CCB growth will not stay at or above the 20% level you achieved in Q1?

I think it's hard to comment beyond the guidance that we currently gave. But what I will say is, if you look at revenue, we're flowing through a beat in Q1, were flowing through a raise and obviously, the contribution from Alsid. So the midpoint of our previously provided range on a full year basis was like $512 million. Today, it's like $522 million, again, at the midpoint, that's over a $10 million raise. And while we don't guide to CCB on a quarter-to-quarter basis, if you look at the full year, it's a similar story. Midpoint of the guidance range was 5.70. Today, the midpoint is 5.80, reflects your beat and a raise in Q1 and then, relative to our expectations. And then obviously, the contribution from Alsid. So pleased to see both revenue and CCB growth growing at 20%. It's early in the year. We're encouraged with what we see. And activity levels remain healthy in our expectations and confidence in the business continues to grow as a result.

Our next question comes from Saket Kalia with Barclays.

Amit, maybe first for you. Maybe just a little bit of a different angle. I was wondering if you could talk a little bit about some of the partnerships you've announced this quarter, particularly with BigFix. And I'm wondering how do you feel that, that partnership could help Tenable competitively? And do you feel like, especially BigFix is sort of a presence in the endpoint management space. Do you feel like customers were pulling you that way in terms of working with an endpoint tool? Or just talk a little bit about what sort of drove that and how you feel like it kind of helps Tenable competitively.

Yes, that's a great question. It's a natural progression for us. Our focus has always been on providing visibility and accuracy, along with broader asset types and enhanced analytics. This not only ensures visibility and accuracy but also assists people in prioritizing their exposures from a risk perspective and in determining the most impactful actions they can take. The next step from there is to enable them to implement those actions. We remain dedicated to being a top-tier provider. For us, working effectively in the enterprise involves using open APIs and integrations to collaborate with other leading technologies and existing enterprise systems to enhance their management functions. In the enterprise sector, BigFix is a reliable and preferred systems management tool. Integrating and automating workflows with BigFix can simplify our customers' tasks and aligns with our efforts involving SSCM and other configuration management technologies. We believe this is a natural evolution that will definitely add value for our customers.

Got it. It's very helpful. Steve, maybe for my follow-up for you, and you've touched on Lumin a couple of times in the prepared comments and Q&A. But I was wondering if you could just dig in a little bit more, whether that's through the lens of an attach rate or just sort of any sense of size in terms of CCB contribution? Anything you could talk about Lumin and sort of how it's become a bigger part of the business, potentially?

Yes. Attach rates for Lumin are continuing to grow. There are seasonal variations in our business, but generally, we expect Lumin attach rates to increase over time. It's important to note that Lumin plays a significant role in the value proposition of our exposure platform, EP. Moving forward, we anticipate that a substantial portion of our sales in Lumin will be through this exposure platform. However, we predict a decline in attach rates. We do not disclose information for individual products, which include OT, Lumen, WAS, and Container. Nonetheless, we do discuss cross-selling in broader terms, which was strong in Q4 and started well in Q1, with a rise in the net dollar expansion rate on a last twelve months basis in Q1. This is a key part of our offering. We are happy to provide more updates on our cross-sell efforts and the progress of the exposure platform throughout the year.

Our next question comes from Joshua Tilton with Berenberg Capital Markets.

For my first one, I kind of just wanted to touch on the billings guidance from a different perspective. So you mentioned that in Q1, you started to see signs of a better demand environment relative to last year. If this continues throughout the year, how much of this improving demand environment is baked into the full year guidance?

Hi Josh, this is Steve. So I want to be clear, and revenue is probably the best way to see this. But we guided to $510 million to $515 million on the last call. Our guidance today is $520 million, $524 million at the high end of the guided range, that's 19% and even at the midpoint. What the revenue reflects as well as the higher CCB guide, because they're both similar, reflects the beat in Q1, reflects a raise and reflects the contribution from Alsid. I think it's fair to say that the raise is probably more modest relative to the beat, but it's certainly is a raise. And it reflects our increasing confidence in the business. It reflects the incremental contribution from Alsid. And obviously, the beat in the first quarter out of the gate.

And if I could just follow up real quick. When I think about it from a customer perspective, what is the benefit of adopting EP versus adopting these offerings as a stand-alone solution? Is there a pricing benefit? Or is it like an integration, single pane of glass-type benefit? Any color there would be helpful.

Yes. In its simplest form, there's pricing benefit. There's license benefit in that you can allocate license, the licenser malleable between products and platforms. So as your environment changes, it becomes easy to scale up, scale down, shift to asset types from here to there. And increasingly, also the analytics in the platform itself. So as I called out examples earlier, leveraging the insight of identity when looking at exposures on systems and items like that or identifying web app services on a host when assessing the host and then being able to kick off and automate a web application security assessment, a web app, application-specific security assessment in addition to assessing the host. So there's natural points of leverage between the products that we'll be taking advantage of in the Tenable.ep platform.

Our next question comes from Brad Reback with Stifel.

Given the 60% price uplift with Tenable.ep, can you give us a sense of what type of tailwind we should get in that dollar expansion rate as the product gains momentum?

Hi, Brad. I think it's difficult to predict the impact it will have on net dollar expansion rate. And one of the reasons why is because, first, we don't optimize the business for a single metric. Pipelines can vary from quarter-to-quarter as the mix between new opportunities and upsell opportunities can vary. We do believe, though, that EP is going to be a far more compelling way for us to sell the broader product suite into a larger customer base that continues to struggle with understanding their risk in a heightened threat environment, in a zero-trust environment. So for us, it's a natural evolution of our product strategy and go-to-market. And keep in mind, years ago, we had a handful of customers spending in excess of $100,000. We've made tremendous progress over the years. Today, we have over 800. That's up 30% year-over-year. So we're doing more enterprise deals, more larger deals in the way we go to market and sell that and as part of a broader offering, we think is really important. And EP is your first step out of the gate. I expect us to continue to evolve our thinking and our efforts there, because we've made good progress over the years and we think our best days are still ahead, given the innovation that we brought to market over the past couple of quarters and couple of years on the product side.

Our last question comes from Gray Powell with BTIG.

Congratulations on the quarter. I'll be quick. I know you don't want to provide an exact number, but out of curiosity, what is the general mix of new business driven by Tenable.io compared to SC? Also, you may have hinted at this in your prepared remarks, but how should we view the net expansion rates for customers using IO versus SC? Additionally, can you provide a rough estimate of the upside for customers on IO?

In terms of our business mix, we launched Tenable.io in 2017, and we anticipated that it would account for a majority of our new enterprise sales in the following year. We're happy with the progress we've made since then. The pandemic and the shift to remote work have increased the demand for cloud services and Tenable.io. In Q1, we reached a record level of new business from io, which aligns with the broader trends we're observing in the market. Tenable.io is performing well and exceeding our expectations, and it complements the sales of other products we offer, particularly in areas like Web Application Security and Container Security, as well as Lumin. Security Center also plays a crucial role in our offerings. Most customers operate in hybrid environments, combining on-prem and cloud solutions. We are among the few companies in the VM space that cater to both traditional and modern assets. This versatility allows us to promote our other products effectively. Regarding cross-selling and our net dollar expansion rate, as we noted last year, there was a slight moderation due to the pandemic. However, the data from Q4 and Q1 shows positive trends, and we are very pleased with our cross-selling efforts. Additionally, we have successfully added many new customers this quarter, including several large deals, which is significant. Moving forward, both cross-selling and acquiring new customers will be crucial, and our go-to-market strategy and existing base are positioned to support both. We're also excited about the recent acquisition that we just closed, as it will greatly enhance our ability to penetrate deeper into our enterprise customer base.

This concludes today's conference. You may disconnect your lines at this time. Thank you for your participation. Have a wonderful evening.