“We would not be surprised to see this dynamic continue, especially given the recent elevated demand for migrations we called out last quarter.”

In context

“nued in Q1. We ended the quarter with 863 customers with ARR of over $100,000, a year-over-year increase of 25%, an acceleration from last quarter's record. We are pleased that the growth rates for our larger customer cohorts were all higher than the 25% growth from our $100,000 cohort, demonstrating that we continue to meet the demands of the highly complex organizations looking for single platform vendors that can address multiple strategic use cases. Turning now to our customer retention rates. Adjusted for the impact of FX, our Q1 gross retention rate was 89%, a 1-point improvement from Q4, while our Q1 net retention rate of 110% was in line with Q4. Similar to prior quarters, our migration products again served as a 2-point headwind to GRR given their naturally lower retention rates. We would not be surprised to see this dynamic continue, especially given the recent elevated demand for migrations we called out last quarter. On a reported basis, Q1 GRR was 89% and NRR was 111%. Turning back to the income statement. Gross profit for Q1 was $86.1 million, representing a gross margin of 73.4% compared to 75% a year ago. The year-over-year gross margin decline is primarily the result of lower gross margins on our services revenue this year versus a year ago. Moving down the income statement. Operating expenses in Q1 totaled $65.6 million or 56% of revenues compared to $56.5 million or 61% of revenues a year ago. As a result, Q1 non-GAAP operating income was $20.5 million, representing a 17.5% operating margin as well as year-over-year expansion of 310 basis points. Importantly, our ongoing management of stock-based compensation, which was 6% of Q1 revenues, has driven an even stronger expansion of our GAAP operat”