HUBS Q3 2024 Earnings

Call Details

• Call Title: HubSpot Q3 2024 Earnings Call
• Date: November 6, 2024 at 9:30 PM UTC
• Management Team:
  • Ryan Burkart (Senior Director of Investor Relations)
  • Yamini Rangan (Chief Executive Officer)
  • Dharmesh Shah (Co-founder and Chief Technology Officer)
  • Kate Bueker (Chief Financial Officer)

Call Summary

Financial Performance

• Total Q3 revenue grew 20% year-over-year in constant currency and as-reported.
• Subscription revenue grew 20% year-over-year, while services and other revenue increased 28% as-reported.
• Total customers were 238,000 at quarter end, representing 10,000 net customer additions and 23% year-over-year customer growth.
• Average subscription revenue per customer (ASRPC) was $11,200, down 2% year-over-year.
• Calculated billings were $681 million in Q3, growing 20% year-over-year in constant currency and 24% as-reported, with a four-point FX tailwind to as-reported billings growth.
• Q3 operating margin was 19% (non-GAAP), up two percentage points year-over-year, and net income was $117 million, or $2.18 per fully diluted share.
• Free cash flow in Q3 was $129 million, or 19% of revenue, and cash and marketable securities totaled $2.1 billion at quarter end.

ARR / Recurring Revenue Growth

• Subscription revenue growth was 20% year-over-year, reflecting core recurring revenue expansion.
• ASRPC of $11,200 declined 2% year-over-year, with ASRPC growth excluding the starter tier reported as mid single digits.
• Net customer adds were 10,000 in Q3, supporting recurring revenue scale with 238,000 customers total.
• Net revenue retention held flat sequentially with customer dollar retention described as in the high 80s.
• Calculated billings of $681 million provide a leading indicator for revenue conversion and grew 20% in constant currency.
• International revenue grew 21% in constant currency and represented 47% of total revenue in Q3.