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Speaker 1: Engines for growth. Ken Rogoff of Harvard sat in your

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Speaker 1: chair at the start of the week and he said

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Speaker 1: he's not sure where growth is going to come from.

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Speaker 1: That's an economist. You're running a business. Where's the growth

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Speaker 1: coming from.

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Speaker 2: That's the difference between someone runs a business right and

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Speaker 2: an economist. Look, I mean, we've talked about AI all

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Speaker 2: week long. It's a big opportunity for us, and I

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Speaker 2: think that you'll just continue to see new opportunities emerge,

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Speaker 2: things we don't even understand yet and applications that we

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Speaker 2: haven't seen that are going to take advantage of what's

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Speaker 2: going on in AI over the next six, twelve, eighteen

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Speaker 2: twenty four months. Cybersecurity is an incredible area of investment

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Speaker 2: for our customers, particularly as generative AI helps the bad

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Speaker 2: people be worse people and make them better at what

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Speaker 2: they do. And we have to really come together as

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Speaker 2: an industry and work hard to protect our customers.

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Speaker 3: So cybersecurity is a big one. I think all of.

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Speaker 2: Our customers continue down this journey of thinking through how

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Speaker 2: their applications are architected and where they reside. Are they

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Speaker 2: into cloud, are they in the private cloud, public cloud,

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Speaker 2: which public clod or am I consuming them as a

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Speaker 2: SaaS application? And you know, hybrid work is still in place.

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Speaker 2: There's there's still a lot of positive out there.

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Speaker 4: How many years have been you've been coming to Davas?

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Speaker 4: This is my eleventh, Okay, so it's been eleven years.

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Speaker 4: This Davos feels a little bit different, like people are

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Speaker 4: actually just trying to get a lot of deals done

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Speaker 4: and try to figure out exactly what to lock in.

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Speaker 4: Do you get that feeling too well?

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Speaker 2: I think somebody asked me earlier about whether this felt

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Speaker 2: like a normal Davos, and I think it seems busier

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Speaker 2: first of all this year, and I do think there's

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Speaker 2: a lot of there's a lot more tangible business discussion

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Speaker 2: I think going on than you might see normally. But

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Speaker 2: there's also a lot more There's a lot more to

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Speaker 2: talk about with all the complexity going on. And you've

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Speaker 2: got elections, You've got you've got the Middle East situation,

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Speaker 2: You've got Ukraine, you've got the are we going to

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Speaker 2: cut rates? You've got Ai.

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Speaker 3: I mean, it just goes on and on and on

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Speaker 3: and on. There's just so much to talk about.

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Speaker 4: What's going to affect your business most? I mean, are

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Speaker 4: you expanding more in certain regions to avoid some of

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Speaker 4: the conflicts that you keep seeing.

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Speaker 3: Or are you basically just.

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Speaker 4: Sort of keeping an eye on all of this and

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Speaker 4: then chugging forward with continuing to try to hire the

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Speaker 4: best cybersecurity people and move forward with all of the

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Speaker 4: different programs that you've been working on.

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Speaker 2: Yeah, I would say that we're investing in areas where

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Speaker 2: we do see growth. We're investing a lot in AI,

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Speaker 2: We're investing in cybersecurity the same areas that I talked

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Speaker 2: about earlier, in which regions, in which regions. It's pretty

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Speaker 2: I'd say it's pretty well balanced.

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Speaker 3: The AI specialists tend.

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Speaker 2: To get hired where we have engineering hubs, so that's

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Speaker 2: you know, first and foremost. But we've also, because of

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Speaker 2: what we saw in the pandemic, I think every company

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Speaker 2: has been diversifying geographically relative to their supply chains so

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Speaker 2: that you know, as we've talked about before, no one

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Speaker 2: ever designed a supply chain expecting an entire country to

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Speaker 2: shut down, so we had to make some changes to that.

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Speaker 2: We continue to work through those kinds of things.

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Speaker 1: You've been going through a big transition quite a while

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Speaker 1: going towards software. So what's recounting revenue. We've been talking

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Speaker 1: about this for years to get we have. It's that

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Speaker 1: transition complete. Now comfortable, you're.

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Speaker 3: We've made a ton of progress.

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Speaker 2: When we get the Splunk acquisition completed, we'll surpass twenty

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Speaker 2: billion in software sales as a company, which puts US

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Speaker 2: somewhere in the top six seven.

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Speaker 3: I don't know, something like that. But there's still more

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Speaker 3: to do. There's still more software.

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Speaker 2: Assets we can build organically, probably some inorganic stuff we

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Speaker 2: can do.

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Speaker 3: But at the same.

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Speaker 2: Time, with the AI explosion, we're a significant recipient of

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Speaker 2: the infrastructure benefit underneath the GPUs in both the web

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Speaker 2: scale as well as ultimately in the enterprise. So our

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Speaker 2: hardware business, which in some cases has subscriptions associated with it,

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Speaker 2: in some cases do not.

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Speaker 3: We think that both of them can grow over the

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Speaker 3: next few years.

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Speaker 1: This is a tough question to answer, but do you

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Speaker 1: think investors have fully internalized your view on where things

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Speaker 1: are going and your message.

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Speaker 3: I think they've internalized the message. I think they're just

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Speaker 3: looking for.

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Speaker 2: One of the things that we've talked about is that

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Speaker 2: this transition to software should give us more predictability and

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Speaker 2: less volatility, and we've seen that come into play, but

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Speaker 2: we still probably have a little bit too much, and

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Speaker 2: so we've been rewarded for what we've accomplished. And I

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Speaker 2: think as we continue to do that and we continue

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Speaker 2: to deliver, you'll see that in the future.

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Speaker 1: You know from bankare for a couple of days. Everyone

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Speaker 1: wants to be a part of the AI story. What

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Speaker 1: surprised us, I speak for myself, what surprised me last

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Speaker 1: year is how quickly it became real. It wasn't just

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Speaker 1: a story that companies were selling. It was something they

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Speaker 1: were monetizing. And the growth was exponential in some cases,

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Speaker 1: and video a great example of that. Can you walk

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Speaker 1: us through on way you're seeing actual, real tangible growth

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Speaker 1: right now off the back of what's developing.

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Speaker 2: Yeah, I've actually told my team you're not allowed to

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Speaker 2: espouse about AI unless you follow it with a tangible

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Speaker 2: way that we're implementing whatever you were talking about, because

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Speaker 2: there's so much noise in the system. Look, I think

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Speaker 2: if we're building the infrastructure that's going to support underpinning

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Speaker 2: all the AI networks. So that's happening today. We're running

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Speaker 2: pilots right now with webscale players. We're working we're working

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Speaker 2: on a lot of design around future integrated stacks that

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Speaker 2: we're going to take to the enterprise to help them

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Speaker 2: do it. Secondly, we're looking at how we can deliver

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Speaker 2: a better customer experience for our customers by leveraging jen Ai,

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Speaker 2: which everybody, every.

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Speaker 3: Company is or should be doing.

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Speaker 2: We're building security assistance as an example, to help customers

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Speaker 2: navigate all the security tools you have and actually make

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Speaker 2: sense of a lot of it more rapidly. We're doing

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Speaker 2: the same in collaboration. We're transcribing meetings and so there's

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Speaker 2: a lot of stuff that's going on right now. But

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Speaker 2: I do think some of the greatest applications we have

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Speaker 2: no idea what they are.

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Speaker 4: Yet, which is something definitely that's been a theme.

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Speaker 3: To say is early. I say early.

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Speaker 4: One thing that's early maybe is that HPE is coming

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Speaker 4: for you more aggressively. They bought Jennifer Networks last week

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Speaker 4: and they said that they're going to be able to

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Speaker 4: compete more directly with you. So what's your response.

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Speaker 3: We love good competition.

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Speaker 4: What's your what's your way? It's your way of getting

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Speaker 4: some of the market share in a highly competitive market.

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Speaker 2: Look, I think that we have competed with both HP

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Speaker 2: and Juniper in the past, so I don't know that

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Speaker 2: it changes a lot for how we think about competing

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Speaker 2: with them.

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Speaker 3: To be honest,