HubSpot Reports Strong Financial Results for Q2 2024
Intellectia.AI Updated: 2024-08-08
HubSpot Reports Strong Financial Results for Q2 2024
HubSpot, Inc. (NYSE:HUBS), the customer platform for scaling companies, announced its financial results for the second quarter ending June 30, 2024.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | YoY Change | Q1 2024 | QoQ Change | Consensus Estimates |
|---|---|---|---|---|---|---|
| Total Revenue | $637.2M | $530M | 20% | $615M | 3.6% | $619.44M |
| GAAP Net Loss | ($14.4M) | ($111.8M) | N/A | ($23M) | N/A | |
| Non-GAAP Net Income | $103.5M | $71.8M | 44.2% | $95M | 8.9% | |
| GAAP EPS | ($0.28) | ($2.25) | N/A | ($0.45) | 38% | |
| Non-GAAP EPS (Diluted) | $1.94 | $1.38 | 40.6% | $1.76 | 10.2% | $1.64 |
Interpretation: HubSpot exhibited robust growth in Q2 2024, with total revenue growing 20% year-over-year, surpassing both YoY and consensus estimates. The substantial reduction in GAAP net loss and the 44.2% increase in non-GAAP net income underscore the company's improved profitability and efficient cost management. Non-GAAP EPS also significantly outperformed estimates, highlighting solid financial execution.
Revenue Performance by Segment
| Segment | Q2 2024 | Q2 2023 | YoY Change | Previous Guidance | Achieved? |
|---|---|---|---|---|---|
| Subscription Revenue | $623.8M | $519.8M | 20% | Not Provided | |
| Professional Services & Other | $13.5M | $11.4M | 18% | Not Provided |
Interpretation: The subscription revenue segment showed a strong 20% growth YoY, contributing significantly to the overall revenue rise. Professional services and other revenue also grew by 18%, indicating a balanced upward trajectory across HubSpot’s revenue streams.
Operational Data
| Data Point | Q2 2024 | Q2 2023 | YoY Change |
|---|---|---|---|
| Customer Count | 228,054 | 185,000 | 23% |
| Average Subscription Revenue/Customer | $11,215 | $11,464 | -2% |
Interpretation: HubSpot's customer count grew remarkably by 23%, reflecting its increasing market penetration. However, the average subscription revenue per customer declined slightly by 2%, which might suggest pricing adjustments or a shift in customer composition.
Comments from Executives
CEO Yamini Rangan emphasized, "Q2 was another solid quarter of revenue growth and profitability driven by our rapid pace of innovation and consistent execution. I am thrilled to see customers consolidating on HubSpot and the momentum we have in becoming the customer platform of choice for scaling companies. We run our business for the long-term and are focused on solving for our customers, innovating our platform, and prioritizing strong execution."
Dividends and Share Repurchase Programs
There were no announcements regarding dividends or share repurchase programs in this quarter.
Forward Guidance
Third Quarter 2024: - Total Revenue : Expected to range from $646.0M to $647.0M - Non-GAAP Operating Income : Expected to be between $107.0M to $108.0M - Non-GAAP Net Income per Common Share : Expected to be between $1.89 to $1.91
Full Year 2024: - Total Revenue : Expected to range from $2.567B to $2.573B - Non-GAAP Operating Income : Expected to be between $437.0M to $441.0M - Non-GAAP Net Income per Common Share : Expected to be between $7.64 to $7.70
Stock Price Movement
Following the earnings release, HubSpot's stock experienced an 11.95% increase, signifying strong investor confidence in the company's performance and future outlook.
In summary, HubSpot showcased a robust quarter with significant revenue growth and profitability improvements, well-received by the market. The positive forward guidance further enhances its outlook for sustained growth.
