Following the company’s filing of its first quarterly report as a public company, JFrog CEO Shlomi Ben Haim said this week the rate at which new application development projects being launched since the onset of the COVID-19 pandemic in the spring has declined.
While most existing application development initiatives launched prior to the pandemic are continuing apace, Ben Haim said it might not be until next year that the velocity of new projects increases.
JFrog revenue for the third quarter was $38.9 million, an increase of 40% from $27.8 million for the third quarter of 2019. Revenue for the first nine months of 2020 was $108.1 million, an increase of 46% from $74.0 million for the first nine months of 2019. In the current fourth quarter, JFrog is projecting revenue between $40.9 million and $41.9 million, with full-year results falling between $149 and $150 million.
Ben Haim said most of the new activity on the JFrog platform stems from a free tier the company launched last month. Much of that individual developer activity hopefully will lead to more formal projects being launched next year, he added.
The biggest challenge DevOps teams have encountered is keeping existing projects on track as most members began to work remotely almost overnight. While application development was often distributed across teams prior to the pandemic, many organizations are still working through how to optimize workflows now that most, if not all, their DevOps teams will be working from home well into the next year.
The economic impact of the COVID-19 pandemic has varied widely by industry. Some industries have been adversely impacted to the point where there is not enough revenue to fund new IT projects. Other vertical industries are accelerating investments in digital business transformation initiatives that research firm IDC projects will grow at a 15.5% compound annual growth rate (CAGR) to reach $6.8 trillion by 2023. Many of those initiatives are becoming the core business continuity strategy around which entire companies are being reorganized.
In fact, Ben Haim noted most of those digital business transformation projects are being driven by cloud-native microservices that require a DevOps platform, which is why the total addressable market for DevOps platforms still remains north of $22 billion, he said.
It’s not clear whether DevOps teams will return to an office once a COVID-19 vaccine has been approved and distributed. In the short term, however, the number of lockdowns around the globe is again on the rise.
In the meantime, whether DevOps teams are more productive working from home than in the office has yet to be proven. The one thing that is certain is managing DevOps teams has never been more challenging. As such, Ben Haim said the most important thing for any DevOps team to make sure they are prioritizing their efforts around the projects that will have the most immediate positive impact on the business.
