Loading...
01/11 07:35
Loading...
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call reveals a mixed outlook: strong YoY revenue and ARR growth, but a reduction in full-year guidance and challenges in the U.S. Federal market. Positive factors include a solid cash position and increased free cash flow. However, the lack of a shareholder return plan and unclear responses in the Q&A about federal spending and certification timelines temper enthusiasm. Given the company's market cap, the stock is likely to remain stable, resulting in a neutral prediction.
Annual Recurring Revenue (ARR) $408 million, up 23% year-over-year, driven by increased spending within the installed base customer.
Revenue $107.5 million, increased 20% year-over-year, primarily due to subscription revenue growth of 21%.
Gross Margin 84.4%, down 130 basis points year-over-year, primarily due to higher incremental costs for hosting and investment in customer success.
Operating Expenses $68.8 million, a 13% year-over-year increase, due to higher personnel costs, event costs, and consulting expenses.
Adjusted EBITDA $23.7 million, or 22% margin, up 2.3 percentage points year-over-year, reflecting solid operating leverage.
Non-GAAP Net Income $26.2 million, or $0.10 per diluted share, a 25% increase year-over-year despite a 20% increase in average diluted shares.
Cash and Cash Equivalents $509.8 million, an increase of $162.5 million year-over-year.
Free Cash Flow $18.5 million, up year-over-year due to strong fundamental results.
New Product Launches: Announced the Spring 2025 release featuring new Cloud foundation and AI-powered innovations across the portfolio.
Product Adoption: Strong adoption of cloud-enabled offerings, rapidly approaching 20% of total ARR.
Insights Migration: Over 30% of installed base converted to Insights, on track to hit 50% by 2025.
Guardian Product Growth: Guardian's ARR growth rate exceeded 100% for the third consecutive quarter.
Market Expansion: Strength in U.S. state and local, LATAM, and Asia Pacific regions; bullish on EMEA pipeline.
Federal Solutions Unit: Launched Cellebrite Federal Solutions unit and pursuing FedRAMP authorization.
Intelligence and Defense Sector: Doubling down on messaging and coverage in the intelligence and defense sector.
Operational Efficiency: Adjusted EBITDA grew 34% year-on-year, resulting in a 22% margin.
Cost Management: Disciplined cost management while funding critical investments for long-term growth.
Strategic Shifts: Elevated focus on strategic options, including inorganic opportunities to expand TAM.
CEO Search: Ongoing search for a new CEO, ensuring the right leadership for future growth.
Federal Spending Environment: The U.S. Federal sector is experiencing spending constraints, which has limited upside for the quarter and is expected to continue into the second quarter.
EMEA Market Challenges: Modest shortfalls in the EMEA geography have been noted, with expectations for improvement in the second half of 2025.
Supply Chain and Professional Services: The spending climate within the U.S. Federal market is affecting consulting and professional services, leading to near-term pressure on one-time professional services revenue.
Tariff Policies: U.S. tariff policies remain fluid, requiring careful assessment, although current tariffs are expected to have a minimal impact on overall cost of goods sold.
Economic Factors: The company acknowledges the unusual turbulence in the market and geopolitical factors that may impact future performance.
ARR Growth: Cellebrite delivered a 23% year-on-year growth in Annual Recurring Revenue (ARR) for Q1 2025, reaching $408 million.
Insights Migration: Over 30% of the installed base has been converted to the Insights platform, with a target of 50% by the end of 2025.
Guardian Product Growth: The Guardian product has seen over 100% year-over-year ARR growth for three consecutive quarters.
Federal Solutions Unit: Cellebrite launched its Federal Solutions unit and is investing in achieving FedRAMP authorization to operate.
User Conference: Cellebrite held its first user conference, attracting 700 attendees from 350 agencies across 27 countries.
AI and Cloud Innovations: The Spring 2025 release includes AI-powered innovations and a new cloud foundation to enhance investigative capabilities.
CEO Search: Cellebrite is actively searching for a new CEO while continuing to focus on strategic options for growth.
Q2 ARR Guidance: Expected Q2 ARR in the range of $416 million to $426 million, representing growth of 20% to 23%.
Q2 Revenue Guidance: Projected Q2 revenue between $110 million to $116 million, translating to growth of 15% to 21%.
Full Year 2025 Revenue Guidance: Adjusted full year 2025 revenue guidance reduced by $10 million, with a cautious outlook on U.S. Federal spending.
Q2 Adjusted EBITDA Guidance: Expected Q2 adjusted EBITDA in the range of $26 million to $28 million, maintaining a margin of approximately 24%.
Gross Margin Guidance: Q2 gross margins expected to be within the full year target range of 84% to 85%.
Shareholder Return Plan: Cellebrite has not announced any share buyback program or dividend program during this earnings call.
The earnings call summary shows strong financial performance with optimistic guidance, particularly in ARR and revenue growth. The Corellium acquisition and FedRAMP authorization are strategic positives. The Q&A reveals confidence in resolving CFIUS issues and strong demand in defense and intelligence sectors. Despite some management vagueness, the overall sentiment is positive, supported by strategic initiatives and growth prospects.
The earnings call summary provides a mixed picture. While there is strong ARR growth and positive developments in AI and cloud innovations, the reduction in full-year revenue guidance and weaker U.S. federal environment are concerns. The Q&A section highlights confidence in federal spending recovery and strong renewal rates, but also notes timing issues impacting ARR. The company's market cap suggests moderate stock volatility. Overall, the combination of positive long-term growth drivers and current challenges leads to a neutral sentiment, with stock price likely moving between -2% and 2% in the next two weeks.
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
