GitLab success due to 'software eating the world': CEO
GitLab (GTLB) shares rallied after the software maker swung to a profit in the third quarter and raised guidance. Third quarter revenue totaled $149.7 million, up 32% year over year.
GitLab CEO Sid Sijbrandij joined Yahoo Finance’s Seana Smith at the Barclays Global Tech Conference to discuss the stronger-than-expected results and AI's impact on the industry.
Sijbrandij attributes momentum to the company's recent AI investments, saying"AI is revolutionizing the software development world."
Sijbrandij added: "AI is the biggest thing… It is a tailwind and it makes our software way more useful. It’s a fast developing space so we have to keep up.”
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Video Transcript
SEANA SMITH: Welcome back to Yahoo Finance. Well, software maker GitLab swinging to a profit in its most recent quarter, the company beating the Street's expectations, also raising its guidance, and that was enough to send shares to the highest level that we've seen in more than a year. So let's talk about that and more. And for that, we want to bring in the CEO of GitLab, Sid Sijbrandij. Sid, it's great to have you here. Thanks so much for taking the time.
SID SIJBRANDIJ: Yeah. Thanks for having me.
SEANA SMITH: So let's talk about that most recent quarter that you just reported. It was the third quarter in a row that you had to beat and raise revenue up 32% on a year-over-year basis. What's driving that demand?
SID SIJBRANDIJ: Yeah, the demand is being driven by software eating the world. Every company has to get better at making software. Now, companies are seeing is that they now have like 15 different tools to create software, and they have to hop between each and every one of them to get it out the door. We consolidate that onto one platform. They don't have the integration costs. And they get typically seven times faster in making a change.
SEANA SMITH: So this quarter was a bit of a milestone here-- your first quarter that you've reported profitability. Are you confident that you're going to be able to sustain that profitability?
SID SIJBRANDIJ: We told the Street that for coming fiscal year, we expect to be non-GAAP operating income profitable.
SEANA SMITH: When it comes to what is driving your momentum, there's been a lot of focus on AI. I know you have been investing heavily in AI. What has that done for your business? And more broadly speaking, how much has it or is it really revolutionizing the software developer world?
SID SIJBRANDIJ: It is revolutionizing the software development world. And it's helping out with so many things. If you imagine, like, one prominent feature has been, like, writing more code. But the AI can help with so many more things, like suggesting reviewers for your code, fixing security vulnerabilities. We've released 14 AI features throughout the development life cycle to help people that are available to customers today. And that help them optimize their entire development security and operations life cycle.
SEANA SMITH: So what does that future investment look like when it comes to AI? How heavily will you be investing in that space, in terms of future opportunities?
SID SIJBRANDIJ: Yeah, we're investing heavily to make all these features really, really great. And this 14 won't be the last. It will be more coming.
