AppFolio, Inc. (APPF) Q3 2025 Earnings Call Prepared Remarks Transcript
Revenue $249 million, growing 21% year-over-year. Growth attributed to winning new customers, growth in total units under management, and more customers choosing premium tiers.
Core Solutions Revenue $54 million, a 17% year-over-year increase. Driven by new customer acquisition, growth in units under management, and adoption of premium tiers.
Value-Added Services Revenue $192 million, a 22% year-over-year increase. Growth due to greater use of risk mitigation services, new screening offerings, online payments, and credit/debit card usage for rent payments.
Non-GAAP Operating Margin 23.5%, compared to 28.7% last year. Decrease due to an additional $13 million expense for annual corporate bonus plan overattainment and increased data center spend.
Cost of Revenue (exclusive of depreciation and amortization) 36% of revenue, compared to 34% last year. Increase due to higher credit card adoption, data center spend, and bonus plan overattainment.
Sales, Marketing, R&D, and G&A Expense 39% of revenue, compared to 35% last year. Increase reflects investments in innovation, sales capacity, and the addition of the LiveEasy business.
Employee Count 1,703 employees, a 10% increase from Q3 2024. Growth in most functional areas and addition of LiveEasy business.
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AppFolio to Announce Q4 Earnings on January 29
- Earnings Announcement Schedule: AppFolio (APPF) is set to announce its Q4 earnings on January 29 after market close, with consensus EPS estimate at $1.25 and revenue at $246.56 million, reflecting a 20.9% year-over-year growth, indicating the company's stability in ongoing growth.
- Historical Performance: Over the past two years, APPF has beaten EPS estimates 75% of the time and revenue estimates 88% of the time, showcasing strong market competitiveness and investor confidence in its financial performance.
- Estimate Revision Dynamics: In the last three months, EPS estimates saw 0 upward revisions and 6 downward revisions, while revenue estimates experienced 6 upward revisions with no downward adjustments, reflecting a cautiously optimistic market outlook on the company's future growth.
- Future Growth Targets: AppFolio has set a revenue target of $945 million to $950 million for 2025, anticipating sustainable growth driven by accelerating AI product adoption and margin recalibration.
UBS Begins Coverage of AppFolio (APPF) with a Buy Rating
UBS Coverage Initiation: UBS has initiated coverage of AppFolio (NasdaqGM:APPF) with a "Buy" recommendation, projecting a 38.08% upside based on an average one-year price target of $319.56/share.
Revenue and EPS Projections: AppFolio's projected annual revenue is $779 million, reflecting a decrease of 14.06%, with a projected non-GAAP EPS of 1.96.
Fund Sentiment Overview: There are 823 funds reporting positions in AppFolio, with a slight decrease in ownership by 2.14% over the last quarter, while the average portfolio weight dedicated to APPF has increased by 2.15%.
Shareholder Activity: Notable changes in shareholder positions include Ashe Capital Management maintaining its stake, Principal Financial Group increasing its holdings by 28.61%, and PMBMX - MidCap Fund significantly increasing its allocation by 90.03%.
