HubSpot, Inc. (HUBS) Q4 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary indicates strong financial performance with an 18% revenue increase and optimistic guidance. Positive trends in AI adoption, cross-sell opportunities, and customer retention further support growth. However, management's vague responses to some questions and lack of detailed pricing impact analysis slightly temper the outlook. Overall, the sentiment remains positive due to strong financial metrics and optimistic guidance.
Key Financial Performance
Q4 Revenue Growth 18.2% year-over-year in constant currency. Reasons: Strong core fundamentals and momentum with the agentic customer platform.
Full Year 2025 Revenue $3.1 billion, 18.2% growth in constant currency. Reasons: Upmarket momentum, multi-hub adoption, and pricing changes.
Q4 Operating Margin 22.6%. Reasons: Disciplined hiring and benefits from partner commission changes.
Full Year 2025 Operating Margin 18.6%. Reasons: Same as Q4, disciplined hiring and partner commission changes.
Net New Customers in Q4 9,800, bringing total to over 288,000, 16% year-over-year growth. Reasons: Pricing changes and strong fundamentals.
Average Subscription Revenue Per Customer (ASRPC) in Q4 $11,700, up 1 point year-over-year in constant currency and 3 points as reported. Reasons: Seat expansion and pricing changes.
Net Revenue Retention for Full Year 2025 103.5%, up from 101.8% in 2024. Reasons: Seat expansion and pricing changes.
Q4 Calculated Billings $971 million, 20% growth year-over-year in constant currency and 27% as reported. Reasons: Strong upmarket performance.
Full Year 2025 Calculated Billings $3.4 billion, 19% growth year-over-year in constant currency and 23% as reported. Reasons: Upmarket momentum and multi-hub adoption.
Free Cash Flow in Q4 $209 million, 25% of revenue. Reasons: Operating leverage and disciplined hiring.
Free Cash Flow for Full Year 2025 $595 million, 19% of revenue. Reasons: Same as Q4, operating leverage and disciplined hiring.
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Operating Highlights
AI-powered solutions: HubSpot introduced AI-powered tools like Breeze Assistant, LLM connectors, and agents such as Customer Agent, Prospecting Agent, and Data Agent. These tools are designed to automate tasks, improve efficiency, and drive measurable growth for customers.
Multi-Hub Adoption: 62% of new Pro Plus customers adopted multiple hubs, with 40% of the Pro Plus installed base owning 4 or more hubs. This trend highlights the increasing preference for integrated solutions.
New Marketing Products: HubSpot launched Data Hub, Marketing Studio, and AEO tools to help customers adapt to AI-driven marketing changes. These tools aim to provide clean data, faster campaign creation, and improved visibility in AI-generated search results.
Upmarket Growth: HubSpot experienced strong growth in deals over $5,000 and $10,000 in monthly recurring revenue, with a fivefold increase in customers with 500+ seats. This was driven by product innovation and brand credibility.
International Revenue: International revenue grew 19% in constant currency and 24% as reported, representing 49% of total revenue.
Revenue Growth: Q4 2025 revenue grew 18% year-over-year in constant currency, reaching $3.1 billion for the full year.
Customer Growth: HubSpot added 9,800 net new customers in Q4, bringing the total to over 288,000 customers globally, a 16% year-over-year increase.
Operating Margin: Operating margin improved to 22.6% in Q4 and 18.6% for the full year, reflecting disciplined hiring and operational efficiencies.
AI Strategy: HubSpot is embedding AI across its platform to help companies grow by automating tasks and providing actionable insights. The company aims to lead with its agent-to-customer platform, leveraging unified customer data and domain expertise.
Share Repurchase Program: The Board authorized a $1 billion share repurchase program, signaling confidence in the company's growth prospects.
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Risk or Challenges
Market Conditions: Potential challenges in adapting to the shift in marketing dynamics, such as declining search traffic and the rise of AI-generated answers, which could impact traditional customer acquisition channels.
Competitive Pressures: Increased competition in the AI solutions market, with many players offering similar tools, which could dilute HubSpot's market share and growth potential.
Regulatory Hurdles: No explicit mention of regulatory challenges in the transcript.
Supply Chain Disruptions: No explicit mention of supply chain disruptions in the transcript.
Economic Uncertainties: Potential risks associated with global economic conditions that could impact customer spending and adoption of HubSpot's solutions, though not explicitly detailed in the transcript.
Strategic Execution Risks: Challenges in scaling AI adoption and ensuring the seamless integration of AI tools across customer platforms, which could hinder growth and customer satisfaction.
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Guidance & Outlook
Revenue Growth: For Q1 2026, total as-reported revenue is expected to be in the range of $862 million to $863 million, up 16% year-over-year in constant currency and 21% on an as-reported basis. For the full year 2026, total as-reported revenue is expected to be in the range of $3.69 billion to $3.7 billion, up 16% year-over-year in constant currency and 18% on an as-reported basis.
Operating Profit Margin: Non-GAAP operating profit margin for Q1 2026 is expected to be 17%. For the full year 2026, it is expected to be 20%.
Net Revenue Retention: Net revenue retention is expected to grow by 1 to 2 points year-over-year in 2026, driven by seat expansion and credit adoption.
Capital Expenditures: CapEx as a percentage of revenue is expected to be 5% to 6% for the full year 2026.
Free Cash Flow: Free cash flow is projected to be about $740 million for the full year 2026.
Customer Additions: Net customer additions are expected to be in the range of 9,000 to 10,000 per quarter in 2026.
Strategic Focus Areas: The company will focus on making AI work for growth companies, reimagining marketing with new playbooks and products, and accelerating upmarket growth with a platform that delivers both power and simplicity.
AI Strategy: HubSpot plans to accelerate its AI vision by integrating AI across its platform, focusing on content, action, and coordination layers to drive measurable growth outcomes for customers.
Emerging Growth Levers: Core seat adoption and credit consumption are expected to expand, driving growth in 2026.
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Shareholder Return Plan
Share Repurchase Program: The Board of Directors has authorized a share repurchase program of up to $1 billion. This decision reflects the confidence in the business and the growth opportunities ahead. The repurchase program is aimed at returning capital to shareholders while continuing to focus on organic product innovation and selective M&A.
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Key Q&A
Q:How defensible is HubSpot's role as a system of record against AI disruption fears?
A:HubSpot's CEO, Yamini Rangan, emphasized that HubSpot's platform is defensible because it serves as a source of customer content, not just data. She highlighted that AI adoption in mid-market companies focuses on driving growth, and HubSpot's platform bridges the gap between AI output and outcomes by providing actionable customer content. The platform's value lies in its ability to deliver trusted, real-time, and actionable content, which is essential for AI-driven outcomes. HubSpot is also building its own agents to ensure value capture and is focused on making AI simple, practical, and actionable for mid-market companies.
Q:What is the disconnect between guidance of slowing growth and net new ARR indicating accelerating growth?
A:CFO Kathryn Bueker explained that while revenue guidance for 2026 implies modest acceleration, net new ARR growth has consistently outpaced revenue growth for the past six quarters. This trend, along with expanding net revenue retention and other growth levers like multi-hub adoption and pricing changes, supports confidence in achieving 20% revenue growth in the future.
Q:How does HubSpot's guidance for 2026 compare to 2025, and what are the key factors influencing it?
A:HubSpot's 2026 guidance is set higher than 2025, with a starting point up by 0.5 points. CFO Kathryn Bueker stated that the guidance reflects confidence in reaccelerating growth, supported by trends like multi-hub adoption, pricing changes, and emerging growth levers such as core seat adoption and credits. The methodology for setting guidance remains consistent, aiming for a range of outcomes that the company feels confident in meeting or exceeding.
Q:How are leading-edge customers using tools like Quad Cowork alongside HubSpot?
A:Co-Founder Dharmesh Shah noted that while Anthropic Quad Cowork is still early and focused on consumer use cases, customers are using the Quad Connector to integrate their Quad accounts with HubSpot. This integration extends HubSpot's customer platform to AI applications like ChatGPT, showing increased usage and optimism for future adoption.
Q:How does HubSpot plan to monetize third-party agents and agent networks accessing its platform?
A:CEO Yamini Rangan stated that HubSpot is an open platform encouraging data integration and partner-built workflows. However, access to customer context at scale will be monitored, metered, and monetized, especially for high-frequency data extraction. The platform is designed to be open but not a free data pipeline, with pricing aligned to the value created for customers.
Q:What trends are emerging in the adoption of AI credits and agents?
A:HubSpot is seeing increased usage of AI credits, particularly for customer agents, which account for nearly 60% of credit consumption. Other use cases like prospecting agents and data agents are also gaining traction. Customers are scaling their credit usage as they see measurable value, with some allocating significant budgets for AI credits after initial trials.
Q:How are customers responding to the rapid development of the Agentic ecosystem?
A:CEO Yamini Rangan highlighted a disconnect between investor perceptions and customer conversations. Customers are focused on driving growth and innovation rather than chasing every new AI announcement. HubSpot's platform, which is easy to use and quick to implement, is helping customers consolidate applications and drive growth, leading to strong upmarket performance in Q4.
Q:What is the contribution of pricing and other growth drivers to HubSpot's acceleration in 2026?
A:CFO Kathryn Bueker explained that net revenue retention trends, driven by higher upgrade rates for seats and modest pricing increases, are key contributors. While pricing changes support retention, the bigger impact comes from seat upgrades and adoption of AI credits, which are expected to continue driving growth.
Q:How is HubSpot leveraging AI internally for efficiency and innovation?
A:HubSpot has transformed its operations with AI, with 97% of code committed using AI assist. AI is also used extensively in support (60% handled by AI), marketing, and prospecting, leading to increased efficiency and faster innovation. The company aims to scale its AI transformation further while incorporating learnings into its products.
Q:Why are AI-native companies choosing HubSpot over building their own platforms?
A:CEO Yamini Rangan and Co-Founder Dharmesh Shah emphasized that while coding has become easier, the value of a platform with domain expertise and unified data remains critical. AI-native companies prefer to focus on adding value to their customers rather than building core systems like CRM or ERP, making HubSpot a preferred choice for go-to-market platforms.
Q:What are the top-of-the-funnel trends and their impact on customer additions?
A:Despite a decline in content-generated traffic, HubSpot's diversification strategy, including channels like YouTube and newsletters, is driving top-of-the-funnel growth. This has enabled the company to maintain a strong pace of customer additions, with a target of 9,000 to 10,000 new customers per quarter in 2026.
Q:What trends are observed among early adopters of AI agents in terms of expansion and funding?
A:Early adopters of AI agents are focusing on use cases with clear measurable value, such as customer agents and prospecting agents. Core seats, which include AI features like Breeze Assistant, are also seeing increased adoption. Upmarket customers show more sensitivity to data security, while downmarket trends are similar.
Q:Where does HubSpot see the biggest cross-sell opportunities in 2026?
A:HubSpot sees significant cross-sell opportunities in Data Hub and Service Hub, especially for customers who initially adopt Marketing Hub and Sales Hub. The adoption of Service Hub is driven by advancements in customer agents and other AI features, while Data Hub supports better data quality and real-time insights.
Q:What are the dynamics of net revenue retention and its drivers?
A:Net revenue retention has been supported by strong seat upgrade motions and growing momentum in core seats and credits. While contact tier upgrades and cross-sell motions have been stable, the primary drivers of retention are seat upgrades and credit adoption, with expectations of a 1-2 point increase in 2026.
Q:How is HubSpot addressing challenges in the SMB macro environment?
A:CFO Kathryn Bueker noted that customer dollar retention remains strong, and seat upgrades are driving growth. While contact tier upgrades are stable, the company expects continued momentum in net revenue retention through seat and credit adoption, helping to navigate challenges in the SMB macro environment.
Q:Review of Unclear Management Responses
A:Management appeared to avoid directly addressing the specific contribution of pricing versus other growth drivers to acceleration in 2026, providing only high-level trends without detailed numerical breakdowns. Additionally, while discussing the SMB macro environment, the response lacked specific details on how broader economic challenges are being mitigated.
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Earnings Word Cloud
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HUBS Transcript
HubSpot, Inc. (HUBS) Q4 2025 Earnings Call Transcript
Positive2-11
The earnings call summary indicates strong financial performance with an 18% revenue increase and optimistic guidance. Positive trends in AI adoption, cross-sell opportunities, and customer retention further support growth. However, management's vague responses to some questions and lack of detailed pricing impact analysis slightly temper the outlook. Overall, the sentiment remains positive due to strong financial metrics and optimistic guidance.
HubSpot, Inc. (HUBS) Presents at Barclays 23rd Annual Global Technology Conference Transcript
Neutral12-10
HubSpot, Inc. (HUBS) Q3 2025 Earnings Call Transcript
Positive11-5
The earnings call summary indicates solid financial performance with strong revenue growth and optimistic guidance. Although there are constraints in billing growth, the company is confident in its AI and credit monetization strategies. The Q&A section reveals positive trends in AI adoption and international growth, despite some uncertainties in revenue translation timing. Overall, the optimistic guidance and strong financial metrics suggest a positive stock price movement in the short term.
HubSpot, Inc. (HUBS) Presents At Goldman Sachs Communacopia + Technology Conference 2025 Transcript
Neutral9-10
HUBS Slides
HUBS Report
Frequently Asked Questions
Where does this earnings call transcript come from?
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.
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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.
