Thank you for standing by, and welcome to Asana’s First Quarter and Fiscal Year 2026 Earnings Conference Call. — Operator Instructions — I would now like to hand the call over to Eva Leung, Head of Investor Relations. Please go ahead.

Good afternoon, and thank you for joining us on today’s conference call to discuss the financial results for Asana’s first quarter fiscal year 2026. With me on today’s call are Dustin Moskovitz, Asana’s Co-Founder and CEO; Anne Raimondi, our Chief Operating Officer and Head of Business; and Sonalee Parekh, our Chief Financial Officer. Today’s call will include forward-looking statements, including statements regarding expected release and benefits of our product offerings, including AI Studio, and our expec- tation for revenue to be generated by AI Studio, our retention and expansion opportunities, our expectation for our financial outlook, including our revised full year guidance, strategic plans, our market position and growth opportunities and our capital allocation strategy, including our stock repurchase programs. Forward-looking statements involve risks, uncertainties and assumptions that may cause our actual results to be materially different from those expressed or implied by the forward-looking statements. Please refer to our filings with the SEC, including our most recent annual report on Form 10-K and quarterly report on Form 10-Q, for additional information on risks, uncertainties and assumptions that may cause actual results to differ materially from those set forth in such 1 statements. In addition, during today’s call, we will discuss non-GAAP financial measures. These non-GAAP financial measures are in addition to and not a substitute for or superior to measures of financial performance prepared in accordance with GAAP. Reconciliation between GAAP and non-GAAP financial measures and a discussion of the limitation of using non-GAAP measures versus their closest GAAP equivalents are available in our earnings release, which is posted on our Investor Relations website at investors.asana.com. And with that, I’d like to turn the call over to Dustin.

Thank you all for joining us on the call today. Q1 was a milestone quarter. We achieved non-GAAP profitability for the first time, and AI Studio, which reached general availability in Q1, surpassed $1 million in ARR, demonstrating powerful early momentum. This progress fuels our journey to sustained profitable growth and positions Asana as the definitive platform for human and AI coordination. In Q1, total revenues were up 9% year-over-year, exceeding the top end of our guidance. Non-GAAP operating margins improved more than 1,300 basis points year-over- year, from an operating loss margin of 9% to an operating income margin of 4%. That is a significant milestone for the company as we reached non-GAAP profitability for the first time. Adjusted free cash flow margin also improved more than 700 basis points yearover-year, with free cash flow margin at 5% for the quarter. Once again, our non-tech verticals grew faster than overall growth for the quarter and grew mid-teens year-over-year. Some of our fastest-growing verticals this quarter included manufacturing and energy, media and entertainment and financial services. We continue to make progress in our enterprise customer acquisition. Our $100,000 and 2 over customers grew 20% year-over-year, consistent with last quarter. A landmark achievement last month was closing the largest deal in Asana’s history with one of the largest employers in the world. This 3-year $100 million-plus contract renewal is a testament to Asana’s unique ability to power complex, cross-functional execution at an enterprise scale. The growth within this customer showcases a powerful combination of organic adoption and intentional expansion driven by our close partnership with the enterprise engineering teams to demonstrate ongoing value. After a rigorous evaluation, Asana was selected as its company-wide standard for project, task, work, and goal management, making Asana foundational to how they plan, track, and execute their most critical work. Now let’s turn to AI Studio. We’ve seen tremendous momentum since our Q4 update driven by customers recognizing the tangible value AI Studio delivers in solving real business problems. We’ve already crossed $1 million in AI studio ARR and are entering Q2 with a robust and rapidly growing pipeline. The interest is truly global with strong traction across all our major geographies. We’re even seeing instances where AI Studio ARR is exceeding seat-based ARR. This highlights how a few users leveraging AI Studio can drive outsized value, and it underscores our conviction that AI Studio has the potential to not only eclipse the revenue scale of seat-based licenses over time, but also to reduce our overall reliance on per seat monetization. The cross-vertical interest is also exciting with notable customer wins across manufacturing, retail, technology, financial services and health care, demonstrating strong and widespread demand. What’s most encouraging about AI Studios momentum isn’t the initial sales, it’s the everyday usage we’re seeing. Because the product is embedded directly in the workflows teams rely on, automation happens where the work happens. That makes AI Studio inherently sticky, avoiding the shelfware fate of many hyped AI tools that live in separate 3 apps or chatbots and end up underutilized. Our customers choose AI Studio for 3 clear reasons. First, it’s built natively into Asana, eliminating the need for a behavior or workflow change. Second, its human-in-the-loop controls are built on familiar Asana features, approvals, work assignments, comments and audit trails, keeping people firmly in charge of every AI step. Third, it runs on our Work Graph, a continuously updating data store of every project, task, goal and conversation. That deep, structured context lets AI handle longer, more complex workflows and enables true human-AI coordination, something point solution agents simply can’t match. This real-world impact is evident with Woolworths, one of Australia’s largest supermarket chains with over 1,000 stores. They’ve implemented AI Studio to transform their safety and capital governance process for store changes. Previously relying on inconsistent slide decks and meetings with up to 60 attendees, they’ve built a smart workflow with AI Studio that analyzes submissions, identifies required approvers, and automatically routes re- quests with all relevant context. This acceleration in decision-making allows Woolworths to implement strategic store improvements faster while maintaining rigorous safety and compliance standards. This kind of targeted automation showcases how our AI capabilities drive both immediate ROI and deeper adoption within enterprise customers. We’ve also secured our first AI Studio deal in India for a popular bakery chain. Working with a local partner, we’ve developed an AI Studio solution to prevent fuel theft across their fleet of dozens of vehicles, a common challenge in that market. Using a simple form to upload fuel receipts, AI Studio automatically extracts and logs fuel data, creating a complete audit trail while eliminating manual entry. This has given managers real-time visi- bility into fleet expenses and improved coordination between drivers and finance teams. The solution is now fully embedded in their daily operations, delivering measurable efficiency gains within weeks of implementation. 4 AI Studio is designed specifically for human-AI coordination, enabling people to move work forward when and where they’re needed. Stand-alone agent models can only succeed when they’re capable of automating entire workflows, ironically relegating them to narrow use cases. In contrast, we focus on augmenting human capabilities at key points in the process, triaging inbound requests, drafting briefs, extracting unstructured data, running deep research, or crunching complex analyses, while teams keep full visibility and control. We don’t replace human expertise; we amplify it in a predictable way, freeing people to focus on higher-impact work. The result: work moves faster, customers are cutting response times from days to hours and eliminating slow meeting-driven processes altogether, delivering immediate measurable productivity gains that compound over time. We are just at the beginning of a long-term opportunity with AI Studio, our initial offering in a broader AI strategy. With AI Studio, our focus has been on empowering cus- tomers who want to build their own AI-powered workflows, automating steps and taking on repetitive work within clearly defined and controlled processes. Realizing the full, transformative potential of AI Studio, and for it to truly become a major growth driver, depends significantly on broader adoption across our customer base. To that end, to accelerate the uptake of AI and AI Studio, we’re launching several key initiatives. Last month at our Work Innovation Summit event in Sydney, we launched the Smart Workflow Gallery, a suite of prebuilt, AI-powered workflows designed to help organizations scale the use of AI in everyday workflows. Based on best practices from a wide range of global companies, these smart workflows provide a blueprint for effective human plus AI coordination across marketing, IT and operations. Customers can choose to build from scratch with AI Studio or adopt one of these prebuilt workflows to get started with AI immediately. For instance, a creative team could de5 ploy a gallery workflow in minutes to have AI review new work requests, evaluate briefs, gather information, flag blockers, and prioritize tasks, elevating humans out of tedious work while maintaining oversight. Our Smart Workflow Gallery is now live with several key workflow templates for IT, marketing and operations available today. And we’ll be rolling out many more over the coming months. We’re also introducing AI Studio Plus, a new mid-tier package launching this month through sales and partner channels and later this summer for self-serve customers. This strategic addition creates a 3-tier structure: Basic, Plus, and Pro. Each tier offers distinct value: Basic, which, as of this month, will be available as part of all Asana paid tiers, provides AI studio credits with monthly usage caps; Plus gives customers the flexibility to selfserve and scale up their usage over time; while Pro delivers generous quarterly credit allowances and enterprise-grade controls. This tiered approach ensures customers can select the right level of AI capabilities for their specific needs. Our strategy here extends beyond simply broadening access to AI studio. By complementing it with new offerings like foundational service plans and upcoming product add-ons such as resource management in Q3, we are systematically enhancing how we deliver value. This approach is designed to improve price value alignment for our customers, which we expect will, in turn, strengthen net dollar retention. This is consistent with the value-based pricing strategy we’ve discussed, and we see this combination as a powerful engine for significant long-term expansion. Looking to H2, we’ll be introducing new goal-oriented agentic collaborators, AI teammates, rounding out the full spectrum of AI capabilities inside Asana. At the foundation of AI Studio is our AI-powered workflow-automation engine, built to automate the repeatable workflows across your business. The Smart Workflow Gallery packages these best practice automations into prebuilt AI workflows any team can deploy in minutes. 6 AI Teammates sit on top as more flexible agents. They keep multi-step work moving with minimal guidance, leveraging prior context, our Work Graph, and fine-grained permissions. For instance, a product lead can assign an AI teammate to implement a feature. They can write code using the Claude Code API, initiate and participate in review and approval workflows, generate and apply fixes in response to feedback, merge the update, and ask another dedicated AI teammate to get started on customer support material, all while posting live status updates in Asana showing its progress. By evolving these capabilities into a persistent coworker, we deepen human-AI coordination and unlock usage-based revenue streams beyond seat licenses, further strengthening our leadership in AI-powered work management. We’re fundamentally repositioning Asana as the platform for human and AI coordination, marking a powerful new chapter in our company narrative. As AI becomes integral to how work gets done, the need for a system that coordinates work between people and AI at scale is paramount. This is more than just a technological shift. It’s a redefinition of teamwork itself. We believe Asana is uniquely equipped to lead this charge. Our Work Graph data model provides the essential structured context, the map of an organization’s work, goals and processes, that AI needs to be truly effective in a collaborative environment. This, combined with our deep expertise in fostering human coordination, allows us to build AI solutions that don’t just automate tasks, but enhance clarity, alignment, and accountability across entire organizations. This is the generational opportunity we’re seizing: to define the future of how humans and AI achieve great things together. As we look to the future, in regards to the CEO search, we’re seeing strong interest and considering candidates carefully. We’ll be patient to find the absolute right leader to guide Asana through this next phase of growth. I’m fully committed to driving our strategy as CEO until my successor is in place. And I’m incredibly excited to partner with our future CEO on our product and AI strategy, as we work together to establish Asana as the leader 7 in this generational opportunity. Our key priorities for fiscal year ’26 are centered on setting Asana up for long-term profitable growth. These include driving customer health, accelerating customer acquisition, and delivering increasing customer value through product innovation, particularly with AI. And with that context, let me turn it over to Anne to discuss our go-to-market momentum, key initiatives and customer wins.

Thanks, Dustin. The strategic investments we’ve made, along with the reallocation of resources towards higher-leverage areas, are driving incremental impact. We continue to make progress in scaling our enterprise motion. The number of customer net adds from the 100,000-plus cohorts grew 20% year-over-year, same as last quarter. Our strategic, multiyear renewal with one of the largest employers in the world is a testament to our differentiation in the enterprise as the collaborative work management platform best positioned to work at global enterprise scale. With hundreds of thousands of active users, teams are driving material impact across functions, which has translated into significant labor cost savings by eliminating manual work and meaningful improvements in employee productivity. Powered by our Work Graph, Asana connects goals, workflows, and data across silos, while our enterprise-grade AI accelerates execution by automating processes and surfacing real-time insights at scale. International markets remain a key strength for our business driven by growing global demand for our platform, especially in EMEA and Japan. As organizations worldwide recognize the value of Asana in improving coordination and driving productivity, our inter- national revenue grew 11% year-over-year. 8 To date, we haven’t seen a material change in the demand environment in any of our segments or regions as compared to the last several quarters. However, we are beginning to see some increased buyer scrutiny and elongation in decisions related to broader consolidation or software stack transformation efforts. That said, the pipeline remains healthy. We’re seeing strong demand generated across our diverse pipeline generation channels, where initial investments, including our optimization of paid media, are driving greater leverage. Let me discuss the progress on our 3 strategic growth priorities: customer acquisition, customer health and customer value. First, customer acquisition. New business remains strong and our investment in vertically focused go-to-market teams and driving adoption of vertical-specific product use cases is resulting in strong growth in our non-tech verticals, which grew once again in the mid-teens, accounting for over 70% of our business. We’re seeing particular strength in financial services, manufacturing, and media and entertainment. A few customer examples in our strategic verticals I want to highlight are, Bozzuto, which is a diversified real estate company specializing in multifamily residential communities across the United States. They expanded their use of Asana in a 3-year deal. Asana will enable their nationally dispersed workforce to more efficiently manage projects and streamline workflows for property setups, maximize throughput and reduce time to market. Additionally, they have invested in AI Studio to optimize work and automate various manual tasks, further enhancing operational efficiency. We had a great expansion deal in financial services. One of the largest credit unions in the world deepened their Asana partnership in a 3-year expansion deal. The organization is using Asana in their core workflows across the real estate lending and contact center operations. Most importantly, after careful evaluation, the procurement team classified 9 Asana as essential software that provides unique value for its cost. Their competitive analysis and ROI assessment showed that Asana effectively addresses their specific needs that no other solutions can match, making us worth maintaining in their software portfolio. While tech continues to drag on our overall growth, we saw another quarter of stabilization of ARR in this vertical and strong demand for AI Studio from technology customers. Expanding our presence with the channel is a key growth and NRR expansion driver. Since the relaunch of our partner program in March, we are making great progress with the channel. Deals with partners attached have exceeded our expectations and grew double digits year-over-year. Of our top 5 deals this quarter, 3 were partner-led. We saw especially good traction in APAC and EMEA. Almost 40% of our APAC deals have partners attached, and we are seeing great digital transformation deals brought forth by our partners. Partners are critical to our growth and scaling of AI Studio, and they also see it as a meaningful growth opportunity. We already have certified partners selling and supporting AI Studio. Moving to customer health. We’ve put renewed focus on addressing churn and downgrades, particularly with small, monthly customers, which represents a disproportionate share of overall churn. We have a new Chief Customer Officer in place to lead our retention efforts across segments, bringing greater executive focus and accountability to customer retention. We are enhancing early life cycle engagement with targeted onboarding to accelerate early engagement and tailored interventions based on churn risk. In the mid-market and enterprise, we’re driving earlier detection through health scoring, strengthening renewal planning, and aligning teams more tightly around at-risk accounts. While still early, these initiatives are showing encouraging traction and are central to our strategy to improve gross retention and NRR in the long term. In addition, we launched foundational service plans in early Q1 as a strategic initiative to 10 boost customer health and retention while unlocking an additional monetization opportunity. The initiative has already proven highly successful in its first quarter, exceeding expectations with strong attachment rates, especially for new business, and generating over 7 figures in new business revenue. We remain focused on aligning price to customer value. This is a key focus of our add-on strategy and AI Studio. In Q1, we exceeded our internal plan with over $1 million in bookings with strong traction across EMEA, APJ, and our first wins in Australia and India. The majority of AI Studio bookings came from existing customers. While the initial success has primarily centered on new business acquisition and expansion opportunities, AI Studio is becoming an important lever to mitigate downgrades in renewal conversations. A leading HR software company’s CIO initially planned to reduce seats due to budget constraints. After showing the CIO the value of AI Studio, multiple teams, including CreativeOps, HR, and PMO decided to adopt AI Studio. The customer not only maintained their existing plan, but expanded with AI Studio, turning potential churn into growth. As customers begin to pair AI Studio with our new Smart Workflow Gallery, they’re scaling these use cases faster and with less friction, opening up the potential for adoption of AI Studio across our base, not just those who build automations and custom workflows. With broader availability of AI Studio coming in Q3 via our self-serve Plus tier and on-bydefault provisioning, we’re positioned to scale AI Studio even faster in the second half of fiscal year ’26 to both new customers and our existing customer base. Our team is focused on our strategic priorities and growth initiatives that are centered around the customer and believe these priorities position us well for long-term growth reacceleration. And now I’ll turn it over to Sonalee. 11

Thanks, Anne. Let me highlight the financial results for the first quarter and then comment more on the outlook. Q1 revenues came in at $187.3 million, up 9% year-over-year, which exceeded the midpoint of our guidance by 1%. We have 24,297 core customers, or customers spending $5,000 or more on an annualized basis. Revenues from core customers grew 10% year-over-year. This cohort represented 75% of our revenues in Q1. We have 728 customers spending $100,000 or more on an annualized basis, and this customer cohort grew at 20% yearover-year. As a reminder, we define these customer cohorts based on annualized GAAP revenues in a given quarter. Our overall dollar-based net retention rate was 95%. Core customer NRR was 96%. And among customers spending $100,000 or more, NRR was 95%. As a reminder, our NRR is a trailing 4-quarter average and therefore, a lagging indicator of more recent trends. Our in-quarter NRR was stable, and we saw improvement in logo churn across all cohorts. However, while our in-quarter NRR was stable for the third consecutive quarter, we expect net retention in Q2 to be pressured. This is due to a combination of continued downgrade pressure, particularly in our enterprise and middle-market segments and the technology vertical. While our $100 million-plus renewal, which we highlighted in our earnings today, materially increases our remaining performance obligations, providing greater visibility into fiscal year ’27 and fiscal year ’28, it represents a modest ACV downgrade as compared to our prior contract. This will negatively weigh on our Q2 NRR, especially in our $100,000 cohort, as well as impacting the stability we have experienced over the past couple of quarters in our tech vertical. We are confident in long-term NRR improvement given the investments we have made 12 in our customer success teams, AI studio and add-on strategy, our work to better align price to value, and focus on improving customer health. However, in the near term, NRR will remain a headwind, which results in strong new business momentum and scaling contribution from add-ons and the channel being less prominently reflected in our overall revenue growth. Now moving to profitability, where I will be discussing our non-GAAP results. We continue to be extremely focused on driving efficiency and productivity throughout our business, maximizing the operating leverage we enjoy from our strong gross margin, which held steady at approximately 90%. We expect to maintain these levels of gross margin in fiscal year ’26 while expanding sequential operating margin as we continue to scale. R&D expenses were $48.9 million or 26% of revenue, down 11% year-over-year. Sales and marketing expenses were $83.7 million or 45% of revenue, down 5.5% year-over-year. G&A expenses were $27.7 million or 15% of revenue, up 2.2% year-over-year. As a result of driving productivity and efficiency gains, we had a positive operating income quarter for the first time in our company’s history, delivering a 4% margin or $8.1 million of operating income, which represents an operating margin of 300 basis points above the midpoint of our guide and a more than 1,300 basis point improvement year-over-year. Net income was $12 million or $0.05 a share. Our profitability improvement was driven by rationalizing and reallocating program spend, particularly in marketing and lead generation, to meet ROI thresholds without sacrificing pipeline and pipeline coverage; reallocating resources to more productive go-to-market motions; driving down infrastructure costs by optimizing our cloud spend; exercising discipline around all discretionary spend; and shifting certain hiring and backfilling to more cost-effective regions like Warsaw and Reykjavík to optimize our onshore/offshore mix and to better align with industry benchmarks. 13 Our continued focus on efficiency and productivity lays a strong foundation for continued operating leverage and multiyear margin expansion. Moving on to the balance sheet and cash flow. Cash, cash equivalents and marketable securities at the end of Q1 were approximately $470.8 million. Our deferred revenue, remaining performance obligations, or RPO, and current RPO, or CRPO, were impacted by the timing of the $100 million plus renewal, which typically is billed in Q1, but was renewed in and will be billed in Q2 going forward. Given that significant impact, we will also be providing those measures as adjusted for the large renewal. Our RPO was $420.7 million, up 11% from the year-ago quarter and, adjusted for deal impact, would have been approximately $521 million, up 37% year-over-year. cRPO will be recognized over the next 12 months and was 83% of RPO and grew 7% from the yearago quarter. cRPO adjusted for the deal timing would have been 73% of RPO, up 17% year-over-year. Our total ending Q1 deferred revenue was $290.3 million, down 2% yearover-year and, adjusted for deal timing, would have been approximately $323.7 million, up 9% year-over-year. Building on our operating margin strength, Q1 adjusted free cash flow was $9.9 million or 5% on a margin basis, an improvement of more than 700 basis points. We continue to take a disciplined approach to capital allocation. Given our strong balance sheet, positive free cash flow, and confidence in our long-term strategy, we believe share repurchases are an effective way to return value to shareholders while offsetting dilution. This quarter, we bought back $15.6 million of our Class A common stock at an average price of $15.09 or 1 million shares. In May, our Board increased our share repurchase authorization by $100 million and removed the program’s previous expiration date. As of April 30, we had $56 million remaining under the prior authorization, representing a total of $156 million available to us for repurchases moving forward. 14 Now moving to guidance. For Q2 fiscal 2026, we expect revenues of $192 million to $194 million, representing 7% to 8% growth year-over-year. We expect non-GAAP operating income of $8 million to $10 million, representing an operating margin of 4% to 5%. And we expect non-GAAP net income per share of $0.04 to $0.05, assuming diluted weighted average shares outstanding of approximately 243 million. For the full year, we are updating our revenue guidance to $775 million to $790 million, representing 7% to 9% year-over-year growth. This range reflects 2 planning scenarios: the upper half assumes continued execution within a stable macro, consistent with our Q4 view; the lower half anticipates elongated sales cycles, increased budget scrutiny, and a more cautious procurement environment, particularly with tech and enterprise customers. We continue to monitor the impact of economic uncertainty on buying and renewal activity. As Anne highlighted, while we have not seen material change in the demand environ- ment, we are observing early signs of increased buyer scrutiny and downgrade activity, particularly in our enterprise and corporate customer bases. While these early signs alone do not change our previous outlook, we do recognize that there is a growing macroeconomic risk and thus are reflecting this risk by expanding our guidance range. We are raising our full year non-GAAP operating margin guidance to at least 5.5% for the full year, up from our prior guidance of at least 5%, and continue to expect sequential improvement throughout the year. In addition, we expect net income per share of $0.22, assuming diluted weighted average shares outstanding of approximately 243 million. I want to highlight that if the macro environment were to deteriorate, we have multiple levers we can pull, which we believe would allow us to preserve profitability at the level of our guide without compromising the investments we have made and are making to drive revenue growth acceleration. 15 As we shared last quarter, Dustin, Anne, and I remain focused on executing a long-term strategy to drive long-term growth acceleration while meaningfully expanding profitability. We are defining how humans and AI coordinate work at scale, and we see a massive greenfield opportunity ahead of us. We believe we have the right strategy in place to capitalize on this opportunity. And with that, operator, we’re ready for questions.

— Operator Instructions — Our first question comes from the line of Matt Bullock of Bank of America.

I wanted to start on AI Studio. Great to see you cross that $1 million ARR threshold. Dustin, maybe if you could just help us think about the breakdown of that $1 million in ARR. What does that consist of? Which types of customers and use cases are driving strong uptake? And then maybe walk us through some of the potential upside scenarios for the back half of fiscal ’26.

Yes. Thanks. That’s a great question. So the $1 million ARR really represents a great sort of diversity and distribution of customers. We have a good number of examples from every region and across different industries and across the different segments as well. So we feel really good about that. And this is entirely comprised right now of the AI Studio Pro platform fees. So part of the upside in the future will come from potentially getting into the incremental consumption. And we are still seeing great patterns over time, with customers continuing 16 to use more and more credits month after month and gain confidence in the system as well as seeing the newer cohorts of customers. A lot of the customers have joined in the past 2 months, they’re starting out faster and consuming more credits out the gate. Part of the reason for that is the launch of the Smart Workflow Gallery. It just came out a few weeks ago, but it lets you deploy both AI studio. And if you’re not an AI studio, you can have it without AI, prebuilt templates. And we’re seeing, where you do have studio turned on, that is working as intended. We’re seeing a lot of those get installed and drive credit usages as well. And then 2 more catalysts that I think provide upside throughout the year, we’re launching the Plus SKU, which is going to be a lower priced, more affordable SKU, I think, later this week actually for sales to start selling and to become self-serve later in the summer. That will open us up more to the SMB market and help customers get started when they need more than what’s available in Basic and less than what’s needed in Pro. And then also AI Teammates, which is a little bit of a new part of the AI road map for fiscal year ’26, but I think it’s going to be a big factor in H2 and will help a lot more end users get the benefits of AI because it doesn’t require building workflows or getting into the automation builder at all. It really is as easy to use as working with normal human teammates. So we don’t know how well Plus and Teammates will do, but seeing all the right things from what we have in market today and have a lot more that we will launch throughout the year.

Super helpful. And just a quick follow-up for Sonalee, if I could. I wanted to ask about the $100 million contract renewal. I believe you mentioned that was in the tech vertical, but are there any other details you can share about that renewal process? Maybe help us think about the change and quantifying the change in ACV there? And then is there 17 anything you can share on how much AI Studio is embedded in that renewal?

Sure. Absolutely. So you’re right, it was in our tech vertical, that renewal. I just want to highlight again, it was the largest deal in Asana’s history, so $100 million TCV over 3 years. The renewal slipped out of Q1 and into early Q2, which is why I shared pro forma balance sheet metrics around RPO and cRPO. And whilst it was a significant expansion in TCV versus the previous contract, there was actually a modest downgrade on an ACV basis. So that will actually impact, and you heard me call this out in the prepared remarks, that will impact our overall net retention and particularly from Q2 and as we look across the rest of the year. And as you correctly assumed, yes, it will weigh on the tech vertical, which up to now and over the past couple of quarters have been showing signs of stability. So with this multiyear deal, we feel like it was a trade-off we were willing to make in terms of the slight ACV downgrade because we now have much greater visibility into fiscal year ’27 and ’28 given the significant increase in RPO that, that actually drives. In terms of the contribution to AI Studios specifically from that renewal, there’s nothing factored in, in the guide right now. That is potential upside. But I think it’s worth me just handing over to Anne just to talk a little bit more about that renewal and the landmark deal and why they chose to work with Asana.

Yes. Thanks, Sonalee. Yes, happy to add more there. What we’re really excited about is the long-term commitment from this leading global enterprise customer. It really allows us to deepen our strategic partnership with them and continue to innovate with this very exceptional company. Some things that I’m particularly excited about, they ran a really rigorous process to choose us and have now a long-term commitment. I think the other thing that we’re really excited about is the use cases across this orga18 nization can serve as inspiration for other enterprise customers. It also shows off our strength in scalability, security, our vision and compliance at the highest levels, some of the really diverse business-critical use cases across their business units and functions that we’re very excited about and continue to expand, So everything from change management and global logistics, managing complex workflows for new product and new device launches, to developing operational benchmarks for process improvement and managing client workflows for their large global accounts team. And then altogether, they are also doing cross-functional goal setting, reporting, project and portfolio status update management across several hundred thousand employees. So it’s exciting to continue to build this relationship and now, as Sonalee said, have visibility over the next 3 years on our ability to deliver value, but then also deliver upside.

Our next question comes from the line of Allan Verkhovski of Scotiabank.

I want to ask another question on AI Studio, but more from an ROI perspective. Dustin, it’s exciting that you’re seeing instances of AI Studio ARR exceeding seat-based ARR. At the same time, there are many agents that SaaS companies are selling, which I would imagine makes it a bit harder for customers to see the ROI, to justify why to pay more for AI Studio. What are your top learnings thus far in selling it? And can you update us on your confidence to have the whales that you mentioned last quarter on AI studio that are spending 6 or 7 figures on it by the end of the year?

Yes. So this is Dustin. I’ll try and unpack those questions. I may need a little bit of clarification. Can you say more about the agents we’re competing with? Why do you think they’re paying more with Asana? 19

Just that like a lot of software companies are trying to monetize AI agents, which I can imagine makes it a little harder for customers to see through that.

See through that, yes. I mean I think that the distinction with Asana is that they’re more successful deploying these. So I think what you get when you have stand-alone agents in another system is partially you need a lot of behavior change, but the bigger issue that I’ve seen in practice is that you need them to be able to take on an entire workflow and kind of replace an entire person. And because of that, you’re not as successful as often. And so customers are turning to Asana because they see that they can take on part of the workflow that can be done by AI and sort of hand back and forth with a human or multiple humans that are on the team, and that lets them be successful in a lot more areas and, as a consequence, across more use cases. So a lot of the agents that other vendors are putting out are more specialized, especially to support. And we can do versions of that. But the types of examples that we were giving, with request intake and campaign management and developing assets, that diversity of use cases works much more on a platform like Asana that can handle all of that. In terms of customers that are paying more than their seat licenses right now, all of the customers are paying about the same for these Pro packages. And so that is largely a function of the fact that they don’t have many seats, but some of them are still getting enough value out of Pro that they are buying this larger package and it’s worth what they’re paying for the seats. What I’d love to see is for that to happen in even bigger accounts. So to have Studio revenue eclipsing a 6- or 7-figure existing account. I think that will take longer. It does take time for the usage to compound, but we are seeing it build, and we’re getting better at assisting customers. Customers are getting better 20 at developing it themselves. We’re building up this library of great templates with the Smart Workflow Gallery. All of that will just increase the scale of what we can sell to an individual customer. And I still think it’s pretty likely that we’ll have some at the end of the year, but I don’t have any – it’s not like we have one in pipeline, so I can’t guarantee it, but I’m seeing all the right things and see all these additional catalysts for how we can get a lot more usage, including Teammates could really change the game, particularly for customers that are already adopted on Studio by the time we launch them. We’ll have some that have been using it for 2 or 3 quarters, and Teammates will let them go much further very quickly. And I think that will be a big asset. And then finally, one I haven’t even mentioned is we’re seeing the emergence of more expensive models like Opus and o3. And as we introduce those in the system, it actually gives the customers the ability to spend more credits on the same workflows if they just want higher quality.

Awesome. That’s really helpful. And then Sonalee, just a quick follow-up for you. Can you share how you’re thinking about revenue from tech customers as part of the updated fiscal ’26 guidance? And also what you’re estimating in terms of impacts from FX versus before?

Yes, sure. So just firstly, to clarify, on Q1, the impact from FX was actually very minimal. It was a couple of hundred thousand dollars. We don’t really tend to call that out, especially if it’s not material, but I think a couple of other people had that question. So it was very de minimis. In terms of how we’re thinking about the tech vertical, obviously, we called out this large renewal being in the tech vertical. So it will continue to have an impact on 21 what we had been seeing in our tech vertical in terms of recovery. But the actual yearover-year revenue growth in our tech vertical was fairly stable this quarter as it had been in the last couple of quarters. And we don’t tend to break out tech versus non-tech on a forward basis in terms of how we’re guiding. But what I would say is that non-tech is still growing, which is close to – about between 25% and 30% of our business today is tech, and non-tech is the rest. That’s growing in the mid-teens and still healthily growing in the mid-teens. So I would say expect apart from that downgrade that we’ve called out specifically in the renewal, the rest of the tech vertical, we would expect to be fairly stable.

Our next question comes from the line of Steve Enders of Citi.

I guess I just want to maybe follow up on some of the pressure you’re seeing in the macro side of it. I think you called out downgrades in the enterprise and mid-market. And if I remember right in the past, it seemed like it’s primarily centered on the tech side. So I guess I just want to understand, is this maybe new pressure that you’re seeing in those segments being impacted across other verticals? Or can you just maybe clarify what exactly it is that you are seeing within the enterprise and mid-market front right now?

Steve, it’s Anne. I’m happy to take that. I think what we just started to see early was some customer budget pressures. There’s still some ongoing workforce reductions and then consolidation of tools under centralized IT management. Where we saw this in particular was in enterprise and the Americas region, which for us has a disproportionate share of tech. But we’re actively working to mitigate a lot of the churn and contraction through all our investments in additional customer success management coverage, identifying at-risk 22 customers earlier, introducing our new, more flexible pricing. And then in particular, I think where we feel like the mitigation is going to come on contraction and churn is with AI Studio and our foundational service plans. Those really do 2 things: one, with AI Studio, higher-value business impacting workflows and adoption; and then with the foundational service plans, what the customers are really getting is ongoing onboarding support, services and the ability to get value faster, so I think – and additional products that they’re buying for us. So while we’re seeing some of the early signs, I think we’ve got things in place to help mitigate it over the long term.

Okay. Great. That’s helpful. And then I guess I just want to clarify on the revenue guide and I guess, the low end of it, and I appreciate some of the commentary around kind of what’s been assumed. But I do want to ask on, I guess, as we think about the lower aspect of it specifically in that scenario, just how scrubbed would you say that scenario is? Or maybe kind of what’s – I guess, how much negativity is being assumed on that low-end guide?

Sure. So the low end of the guide is definitely taking into account being much more prudent. It reflects not just the trends that Anne called out just now, around what we’re seeing, but it actually reflects additional risk and additional macro pressure, which we have not seen yet, but we wanted to provide a guidance range that, at the high end, is reflecting what we see today and then, at the low end, incorporates a potential worsening given there is a lot more uncertainty out there today than when I last guided, which was in March with our Q4 earnings. So we’re comfortable with the range we provided, and we feel like it covers a wide range of outcomes. But certainly, the low end factors in a more bearish view on net retention from where we are today and the macro worsening. 23 Hopefully, that’s clear.

Our next question comes from the line of Josh Baer of Morgan Stanley.

If we do make the adjustment on the deferred and pull that into Q1, I think billings growth was around 5%, which was below the history here. So just wanted to see how Q1 billings really performed versus your internal plan? And then the follow-up would be just anything to call out as we navigate billings for the rest of the year as far as seasonality or with regard to other renewals or dynamics over the next several quarters.

Yes. So you get an A+ on your math, pro forma, that’s exactly what it was. So it was about 5% in Q1. And Q1 is seasonally lower for us in billings growth typically, and you’ll even see that in the trends last year. And that’s because of the timing of our multiyear deal renewals. And they tend to accelerate into the second half of the year. And given the downgrade pressure that we’re seeing and that Anne called out in enterprise, which tend to be annual and multiyear deals and upfront billing, that weighs our billings naturally. But what I would say is on the other side, on the flip side, we’re continuing to see strength in our SB business, which is offsetting some of that pressure. And if you think about full year billings, it should be in line with our guided revenue growth range.

Okay. Great. That’s helpful. And just wondering, Sonalee, you mentioned a trade-off with regard to the large deal. Is that in like thinking about volume discounting in return for the longer duration on that contract?

24 Yes. So I talked about a modest ACV downgrade, so what we get from them annually, but we felt like that was definitely worth the trade-off given Anne talked about the strategic importance of this deal. And the other thing is we’re in there now. We’re in there for the next 3 years. And there’s – someone earlier asked a really great question about is AI Studio in that deal? No, it’s not today. Are FSPs in that deal? Not today. So these are all potential areas of upside. And again, we would do that kind of deal again. So yes, it was definitely worth the trade-off. And it’s a long-term commitment, and we love the visibility it provides for fiscal ’27 and ’28. And we think it’s a real validation of our leadership position in this category and our ability to scale. They wanted to work with us.

Yes. I’ll just add on, since Sona said the magic word, we’re really excited to announce that today, we are named as one of just 2 leaders in the Forrester Q1 Collaborative Work Management Wave. So I think that only reinforces that we have a special position in enterprise here.

Our next question comes from the line of Taylor McGinnis of UBS.

I just wanted to press on NRR. So it sounds like in-period NRR in 2Q is expected to come down both from the $100 million renewal coming in on the ACV side and then also an uptick in potential downgrade activity given some of what we’re seeing in the macro. So Sonalee, can you just unpack that a little bit more for us? Like, when you think through those 2 potential impacts, like any way to help us quantify and think about what the trajectory of NRR could look like from here?

Yes. So no problem, Taylor. So in-quarter NRR for this quarter was actually stable. And 25 the rolling 4 quarter, which, as you know, is an average of the trailing last 4 quarters, that actually went down in this current quarter. And that was really due to the composition of the cohort. So Q1 of fiscal ’25 actually had a relatively higher NRR. So as that quarter dropped out of the calculation, the average declined. But as we look forward, and I think that’s what you’re more interested in, yes, this renewal with this large enterprise tech customer will factor into – or will weigh down on our net retention from Q2 and for the rest of the year. And the only thing I would say there is that if you look at our in-quarter $100,000-plus cohort of customers, that actually improved this quarter and in-quarter, which is really encouraging. And the other thing I would say is that what we’re seeing from the logo side of things, we’re actually seeing decreased logo churn. So customers are choosing to stay with us even if they downgrade seats. And I think that what makes us feel really good about that is that those are upsells in future quarters. So I think when we think about our NRR as we go forward, Q2 to Q4 is likely to be pressured because of this deal that we’ve called out and also because of the enterprise trends that Anne called out. But some of the things we’re doing on AI Studio, our multiproduct approach, some of the add-ons that we have coming in the second half of the year, will help to mitigate some of that pressure.

Perfect. And then my second question is just you talked about some of the levers that you have in the business, potentially if we start to see a slowdown in growth from some of the uncertainty out there. You saw good upside to operating margins this quarter. So can you just maybe comment on you had the RIF last quarter, how much of like the upside that we saw was savings from that versus maybe other sources of cost saving and efficiencies you’re seeing in the business? And if we do see that scenario of a slowdown, maybe you could just talk through some of the potential sources of upside on the margin line. 26

Sure. So thanks. We’re really proud of what we’ve done on both the operating margin and free cash flow margin side of the business, 1,300 basis points year-over-year improvement. And those cost actions that you referred to that we took at the end of last year, they were factored into the guidance. And of course, they ramp throughout the year. So they help to drive that quarter-over-quarter or sequential margin expansion story. And that’s from actions we’ve already taken. So you get that margin expansion without doing anything incremental. And we’ve guided to at least 5%, implying that there was upside at the time. And now, of course, today, we raised that guide to at least 5.5%. And there will be a continued focus from Dustin and myself and the entire team around driving efficiency and looking for incremental savings opportunities. When you ask about specific areas, we think that there’s more leverage we can drive from increased productivity around our go-to-market and marketing spend and then additional work on vendor rationalization. And you’ve heard us talk about the geographic mix of our workforce. And we do that actually via attrition for the most part. And we feel that over time, we can get much closer to where industry benchmarks are for a company of our size and scale and growth profile. So there’s a lot more to go here. We’re super happy with the progress we’ve made, and you should consider margin expansion on a multi-quarter and multiyear basis to continue.

Our next question comes from the line of Lucky Schreiner of D.A. Davidson.

Just one for me. It was interesting to hear about the leading HR company initially planning to reduce seats, but after AI Studio expanded their plan. Maybe taking that a step further, how do you view consolidation trending in the work management space here? And does 27 AI Studio act as a potential catalyst for larger customers to consolidate on to Asana?

Yes, Lucky, thank you for that question. I think what we’re seeing is we certainly feel like there’s a couple of opportunities for consolidation. One is even just point solutions. So by having workflows all on Asana, there’s things as straightforward as translation and localization workflows that might be being done by customers with point solutions right now that are very easy to move on to Asana. And so those point solutions that might do basic intake flows or even ticketing, the benefit of consolidating on to Asana is, one, the reliability of the data that customers are working with, the context on which team, which department, which tasks, which portfolios, all of that is in Asana, plus all the benefits that have always been on Asana, which is cross-team collaboration. So we’re certainly seeing that. And then I think to your question around consolidation of work management, again, I think the benefit of everybody working on the same platform as well as our ability to give customers the choice on which models, I think, has been really powerful and differentiated and the transparency on how the AI Studio workflows are working behind the scenes. So we certainly look for more consolidation opportunities, but we’re already starting to see those point solutions be replaced by workflows on Asana.

Our next question comes from the line of Patrick Walravens of Citizens Bank.

Dustin, I want to take the conversation up a level if it’s all right with you. I would love to hear your thoughts on the future of work for young humans. So we all know that last week, Dario at Anthropic made the comment about up to 50% of entry-level white-collar jobs maybe being eliminated and unemployment spiking. I know you give these matters 28 a lot of thoughts. I’d love to hear your perspective sort of at a high level for our society and then maybe where Asana might have a role to play.

Yes. Thanks. Great question. I think my perspective is mainly just that AI is real, and we’re not really prepared for it. And I think that, that was mostly what Dario was going for. He’s not trying to solve the problem from his seat as a CEO in one company, but trying to get the attention of society and get the attention of government on it. And personally, I think part of that equation will need to be some redistribution of wealth, which is not very conducive to the current political environment. But I think that would be the ideal kind of solution because I think it will be very, very tough to transition the entire working population into a new way of working. And in a lot of cases, it won’t make the most economic sense. So I think the real solution we need there is higher level than what individuals can do. The best advice I have heard for individuals and for young people, it was either on the Dorkish podcast or on Hard Fork, but one of the guests was saying, think more about what you would want to do in the world without paying as much attention to how hard it is to build because maybe that part will be easy later, and so more focus on the skills that are less around business management and building a company and more around whatever the specialty is that you want to go into. That made some sense to me, but I don’t pretend to have all the answers in my pocket on this one. I think it’s a really big issue. I think change will happen faster than most people believe. And I agree with Dario that we shouldn’t sugarcoat it. I think it will be difficult. And I hope that Asana has a role to play in making it as smooth as possible for organizations and for employees, making it easy to use these new tools and have them be a companion, at least for the time before there’s massive job displacement. I think it will be an enhancement and will make people’s lives 29 easier and we’ll just give people more leverage in their work. And we can be part of that. We can be part of making it safe. We can be part of making it secure, and we can help organizations get from here to a radically different future.

Thank you. I would now like to turn the conference back to Eva Leung for closing remarks. Madam?

Thank you for joining our call today. If you have any questions, feel free to call or e-mail me. We’ll be on the row at BofA conference tomorrow and Baird conference on Thursday and D.A. Davidson next week. Looking forward to seeing you there. Thank you.

This concludes today’s conference call. Thank you for participating. You may now disconnect. Copyright © 2025, S&P Global Market Intelligence. All rights reserved 30