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Jamf Holding Corp. (NASDAQ:JAMF)
Q3 2021 Earnings Call
Nov 11, 2021, 4:30 p.m. ET
Contents:
- Prepared Remarks
- Questions and Answers
- Call Participants
Prepared Remarks:
Operator
Thank you for standing by, and welcome to the Jamf’s third quarter 2021 earnings conference call. At this time, all participants are in a listen-only mode. After the speakers’ presentation, there will be a question-and-answer session. [Operator instructions] As a reminder, today’s program is being recorded.
I would now like to introduce your host for today’s program, Jennifer Gaumond, vice president of investor relations. Please go ahead.
Jennifer Gaumond — Vice President, Investor Relations
Good afternoon and thank you for joining us on today’s conference call to discuss Jamf’s third quarter 2021 financial results. With me on today’s call are Dean Hager, chief executive officer; and Jill Putman, chief financial officer. Before we begin, I’d like to remind you that shortly after the market closed today, we issued a press release announcing our third quarter 2021 financial results. We also published an investor presentation and an Excel file containing quarterly financial statements for fiscal years 2019 and 2020 and 2021 year to date to assist with modeling.
Today’s discussion may include forward-looking statements. Please refer to our most recent SEC filings, including our most recent annual report on Form 10-K where you will see a discussion of factors that could cause actual results to differ materially from these statements. I would also like to remind you that during the call, we will discuss some non-GAAP measures related to Jamf’s performance. You can find the reconciliation of those measures to the nearest comparable GAAP measures in our quarterly financial statements.
Additionally, to ensure we can address as many analyst questions as possible during the call, we ask that you please limit your questions to one initial question and one follow-up. Now, I’d like to turn the call over to Dean Hager. Dean?
Dean Hager — Chief Executive Officer
Thank you, Jen, and thank you, everyone, for joining us. On today’s call, I will share highlights from the third quarter and recap our annual Jamf Nation User Conference. Jill will then review our third quarter financial results, provide our outlook for the fourth quarter and fiscal 2021 and give some high-level thoughts on fiscal 2022. For the last few quarters, we’ve talked about the remarkable momentum, consistency, and balance across our business, and Q3 was no exception.
Our total ARR growth was 47% and. As a reminder, Jamf completed the acquisition of Wandera at the beginning of Q3. So this ARR is reflective of our combined companies. Jamf’s Q3 organic ARR growth was 37%, which matches our average ARR growth for the six quarters we’ve been a public company, demonstrating remarkable consistency.
Going forward, we will not break out ARR growth by product or acquired companies. But we felt it important to provide this clarity since Q3 represents the first quarter post acquisition. This ARR growth was driven by both strong new logo acquisition, growing Jamf’s total active customers to over 57,000 by the end of Q3, and also tremendous growth within our customer base due to Apple device expansion and customers purchasing new add-on products. Still, despite customers growing their use of Jamf, no one customer represents more than 1% of our total ARR, a testament to the diversification of our revenue stream.
Additionally, once again, we saw excellent year-over-year ARR growth for all Jamf products, all three major geographies, and all of Jamf’s top 10 commercial industry. We talked last quarter about how in both Jamf’s commercial and education markets we saw bookings growth rates returning back to pre-pandemic levels. As expected, in Q3, after tremendous growth last year, the education market leveled off a bit. While growth in Jamf’s commercial markets accelerated even further.
Commercial markets again made up nearly 75% of our total bookings, with both the Americas and EMEA markets showing substantial strength. Jamf’s growth is reflective of Apple’s device growth across global enterprises, driven by the acceleration of IT consumerization, user preference, and financial savings for organizations. In our Q2 earnings call, we cited a new Forrester report finding those cost savings of deploying an M1 Mac as $843 per device when compared to its PC counterpart. In Q3, Hobson & Company, a leading research firm focused on total cost of ownership and return on investment studies conducted new independent research specifically with Jamf customers and found that our Apple Enterprise Management solution addressed several specific customer challenges across both large and small enterprises to deliver a quick and compelling ROI.
The study identified that Jamf’s platform delivers significant benefits to organizations across three broad business objectives: simplifying IT management, improving end-user experience, and mitigating risk. Respondents indicated a 90% reduction in time spent on device provisioning, deployment, ongoing management, and application management. End-user productivity also benefited with customers seeing a 90% reduction in productivity loss as support tasks were virtually eliminated with Jamf. And as security continues to be a key focus for organizations, customers saw a 70% reduction in time spent remediating incidents and vulnerabilities.
We believe the significant value of Apple Enterprise Management and specifically, the Jamf platform will continue to drive organizations to expand their Apple fleet through employee choice programs, in particular, for Mac. Today, Jamf serves more than 50 customers who have deployed greater than 10,000 Mac, far more than any other provider of management and security solutions in the world. In no industry has Mac choice been more prolific than in the technology industry, where the Mac has become the device of choice for software engineers. Jamf’s Apple Enterprise Management solutions are used by eight of the top 10 technology companies in the world, three of which have deployed more than 100,000 Mac.
In Q3 alone, five technology companies grew their Jamf deployments from supporting a total of approximately 150,000 Mac to over 175,000. We believe the changing employee demographics combined with the consumerization of IT, growth in remote work, and overwhelming popularity of the new line of Apple Silicon Mac is changing the landscape of the PC marketplace. According to the latest analysis by IDC, in Q3, Apple shipped more Mac than in any quarter in history with a growth rate double that of the industry. More importantly, this Apple Mac momentum has been sustained with greater than 29% year-over-year growth for the full year 2020, as well as 2021 year to date, making Mac the fastest-growing computer over those seven quarters, a growth rate approximately twice the industry.
As Jamf’s platform capabilities broaden to solve more IT and security challenges while helping enterprise math become more affordable, we’ve seen mass choice expand at even faster rates. One example of clear Jamf and Mac ROI benefits is found at BJSS, a U.K.-based technology, and engineering consulting fund when the M1 chip and Big Sur arrived in 2020. BJSS’ existing systems couldn’t provide the support they needed for Apple’s new technology. So they purchased 1,400 seats of Jamf Business Plan, which includes all Jamf management, connection, and protection solutions.
And now BJSS tells us their new ability to purchase the more affordable M1 Mac and manage and secure them out of the box has resulted in rapidly achieving return on their Jamf investment. Jamf’s value and momentum is also accelerating as we help organizations with industry digital transformation, which has led to iOS and iPadOS representing the fastest-growing device type on our platform for the past four quarters. Jamf differentiates with a patented ability to automate unique industry workflows for rapid adoption of Apple devices, specifically to transform mission-critical processes and customer touchpoints. In Q3, this capability led to Jamf signing the largest commercial iOS and iPadOS deal in Jamf history.
One example of Jamf’s industry digital transformation can be found in the transportation industry, where one of our partners, LifeSaver Mobile, provides a solution that prevents employee phone use while driving as they did with Bee Sweet Citrus, a key supplier of citrus to Costco. LifeSaver Mobile’s app can be deployed to every employee’s phone with each app managed by a cloud-based fleet portal that includes a device restriction by implementing real-time locking of iPhone devices when the employee is behind the wheel, enhancing driver safety. Continuing with the travel industry, in aviation, Jamf has become the go-to partner for airlines around the world for numerous workflows that engage flight attendants, gate agents, and ground crews. One specific workflow that leverages our patented Jamf setup and reset applications provides pilots with cockpit flight bags on iPad, where the content available changes based on whether the pilot is in cockpit or off duty.
Over the past year, this has led to Jamf being used to deploy over 100,000 devices for airline-specific workflows globally. Q3 represented our best quarter ever for the airline industry. And finally, on the topic of travel industry, Jamf was proud once again to partner with SpaceX to manage the iPads used in the first all civilian space flight in September. The power and value of Jamf’s industry workflows can also be seen in the education market.
Our patented Jamf Teacher, Jamf Student, and Jamf Parent functionality are completely unique with no other traditional MDM provider matching Jamf’s in-classroom capabilities. Sacramento City Unified School District, who had previously deployed Jamf School, Jamf Pro or Jamf Setup and Reset apps, and Jamf Connect, expanded their deployment to include Jamf Protect in Q3. And therefore, is now running our full Apple Enterprise Management platform. The result is that Sacramento City now has unique in-classroom capabilities that give teachers control of their classroom so that they can best empower student learning with Apple technology.
2020 was a year of transformation in education with tremendous device growth as schools became aware of the power of education technology in the importance of equitable access to learning. While last year’s focus was on device distribution and connectivity, the focus has now shifted to ensuring student safety while using these devices. With the recently passed federal K-12 Cybersecurity Act, along with funding to strengthen school’s IT security protocols, we anticipate a greater need for student safety solutions. Jamf’s new student safety offering, which builds upon technology acquired from Wandera and was announced at JNUC in October, provides content filtering, threat defense, acceptable use, and data policies, along with device and network protection meeting this growing need to protect our students and give peace of mind to teachers and parents.
Another example of leveraging the power of Jamf’s technology, combined with new capabilities from Wandera can be seen with Berkshire Healthcare NHS Foundation Trust, which provides mental health services and other community-based health services primarily to the Royal County of Berkshire in the U.K. Berkshire Healthcare NHS leverages both Jamf and Wandera to deploy new devices and ensure these devices are protected and in compliance. During the height of the pandemic, they saw a 25% increase in mobile device demand and utilize Jamf for efficient zero-touch deployment across its users and facilities. They have also seen significant value in employing Jamf’s new data policy solution from Wandera for ongoing data savings to both iOS and…