“On an overall basis, though, we still feel very confident with the total gross margin being in the low 70s for the year in the product gross margin being in that mid-70s.”

In context

“Tim Adams (CFO): Yes. This is Tim. Let me start with the professional services. So we know that the revenue can vary from quarter-to-quarter. We think about it on a full-year basis. What we did see in Q1 is some experience with the scheduling challenges, which was really driven by some of the attrition in our team. So that put a little more pressure on the gross margin because you have to ramp up hire some new staff. And then we try to supplement that with some third-party labor as well. So that gave us a little pressure on the gross margin that we see in Q1. On an overall basis, though, we still feel very confident with the total gross margin being in the low 70s for the year in the product gross margin being in that mid-70s. We commented similarly last quarter where it really comes down to product mix that can drive that gross margin. And as we've talked about the some of these newer services that we have in the marketplace that security transformation solutions are very high growth and they are changing the mix dynamic. And they're still earlier on in that lifecycle, scaling and efficiency and driving their own gross margin. But overall we feel very confident with the total gross margin being in the range that we've laid out and with product gross margins staying in that mid-70s range.”