Jamf Holding Corp. (JAMF) Q2 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call presented strong financial performance with a 15% revenue growth and improved margins. The Q&A highlighted strategic initiatives and positive traction in new markets, despite some economic uncertainties. The company has a substantial cash position and optimistic guidance for the year. The repurchase of convertible notes and strong ARR growth further support a positive outlook. The market cap indicates a potential 2-8% stock price increase over the next two weeks, classifying the sentiment as positive.
Key Financial Performance
Revenue Year-over-year total revenue growth was 15% to $176.5 million, exceeding the high end of our guidance range by $7 million. This performance was primarily due to the timing of certain revenues that were recognized in the second quarter and solid results from Identity Automation.
Total ARR Total ARR grew 14% year-over-year to $710 million. Security bookings were strong, driving 40% year-over-year growth in Security ARR to $203 million. This was driven by both the inclusion of Identity Automation into our results and the launch of our platform solutions.
Recurring Revenue Recurring revenue grew 16% and represented 98% of total revenues.
Non-GAAP Operating Income Margin Non-GAAP operating income was $33.5 million or a 19% margin, a 360 basis point improvement over Q2 2024.
Adjusted EBITDA Q2 adjusted EBITDA grew 40% to $35.3 million, representing a 20% margin.
Trailing 12-Month Unlevered Free Cash Flow Trailing 12-month unlevered free cash flow surpassed $100 million for the first time, growing 24% to $102.9 million. This represents a 15.4% margin compared to a 13.8% margin in the prior year.
Cash Position From a cash perspective, we ended Q2 with $482 million compared to $222 million at the end of Q1. This increase in cash was driven primarily by the $400 million term loan facility we entered into in May, partially offset by the $175 million payment associated with the close of the Identity Automation acquisition on April 1.
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Operating Highlights
Jamf for Mobile: Introduced tailored solutions for mobile-first strategies, including enhanced security and operational workflows. A Middle Eastern airline adopted it for 10,000 iPads in a 4-year deal.
Jamf for Mac: Enhanced security and management for Mac environments. A German car manufacturer and a healthcare provider adopted it, with the latter signing a 3-year agreement to expand Mac usage.
Jamf for K-12: Focused on education, providing device management and security. A large school district in Kentucky switched to Jamf for K-12 in a 4-year deal.
AI Assistant: Introduced new AI capabilities like search and explain skills to enhance IT admin productivity and decision-making.
Geographic Expansion: Jamf Nation Live events held in Europe and the U.S., with plans for Asia Pacific.
Android Enrollment Support: Launched Android enrollment support to manage cross-platform mobile fleets, keeping Apple at the center of strategies.
Revenue Growth: Achieved 15% year-over-year revenue growth in Q2 2025, reaching $176.5 million.
ARR Growth: Total ARR grew 14% year-over-year to $710 million, with Security ARR growing 40% to $203 million.
Operational Efficiency: Non-GAAP operating income margin improved to 19%, and adjusted EBITDA grew 40% to $35.3 million.
Strategic Reinvestment Plan: Focused on reallocating resources to high-growth areas and enhancing AI capabilities.
AI Integration: Deployed AI across operations, sales, and customer success, improving forecasting, risk detection, and customer engagement.
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Risk or Challenges
Market Conditions: The company faces challenges in maintaining growth amidst current market conditions, as reflected in the cautious revenue growth outlook of 11% for Q3 2025 and 12% for the full year 2025.
Competitive Pressures: Jamf faces competition from larger UEM vendors, as highlighted by the Middle Eastern airline deal where Jamf was chosen over two major competitors. This indicates ongoing competitive pressures in securing large-scale contracts.
Regulatory and Compliance Risks: The company must meet numerous security requirements and certifications, as evidenced by the German car manufacturer deal. Failure to comply could impact customer acquisition and retention.
Supply Chain and IT Infrastructure: Insufficient IT infrastructure and technical issues are cited as barriers for mobile device adoption in industries like retail, manufacturing, and healthcare. This could limit Jamf's ability to expand its market share in these sectors.
Economic Uncertainties: The company’s cautious financial outlook and focus on cost efficiencies suggest potential concerns about broader economic uncertainties impacting customer spending.
Strategic Execution Risks: The strategic reinvestment plan involves reallocating resources and enhancing AI capabilities. Missteps in execution could hinder growth and operational efficiency improvements.
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Guidance & Outlook
Q3 2025 Revenue Outlook: Total revenue expected to be between $176 million and $178 million, representing year-over-year growth of 11% at the midpoint.
Q3 2025 Non-GAAP Operating Income Outlook: Non-GAAP operating income expected to be between $41.5 million and $42.5 million, representing a non-GAAP operating margin of 24% and growth of 52% at the midpoint.
Full Year 2025 Revenue Outlook: Total revenue expected to be between $701 million and $704 million, representing year-over-year growth of 12% at the midpoint, an increase of $9.5 million from prior outlook.
Full Year 2025 Non-GAAP Operating Income Outlook: Non-GAAP operating income expected to be between $153.5 million and $155.5 million, representing a non-GAAP operating margin of 22% at the midpoint, a 600 basis point improvement over fiscal year 2024, and an $8.5 million increase from prior outlook.
Unlevered Free Cash Flow Growth for 2025: Expected to grow at least 75% for the year.
Fiscal 2026 Objective: Aim to exit fiscal 2026 at a Rule of 40 run rate, defined as the sum of year-over-year revenue growth plus adjusted EBITDA margin.
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Shareholder Return Plan
Repurchase of Convertible Senior Notes: The company intends to use proceeds from a $400 million term loan facility to repurchase a portion of its convertible senior notes due 2026.
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Key Q&A
Q:How quickly do you think supporting the broader ecosystem, including Android, will drive results?
A:The decision to support Android was driven by customer requests, particularly for security products. There has been good traction and uptake since the capability was introduced on July 1.
Q:How much revenue is Identity Automation contributing now, and what is its expected contribution for the rest of the year?
A:Identity Automation has been integrated into the education business, with its CEO now leading the group. It contributed half of the upside in Q2, partly due to conservative modeling and outperforming expectations. The other half of the upside came from Jamf and partner-related business.
Q:Has the strategic resource allocation plan changed your view on achieving the Rule of 40 by 2026?
A:The plan focuses on reallocating resources to growth areas, improving efficiencies in small business, investing in automation and AI, and expanding enterprise sales and support. The target to achieve the Rule of 40 by 2026 remains unchanged.
Q:Why does the fiscal Q3 guide show less than normal seasonality compared to previous years?
A:The Q3 guide reflects timing impacts from Q2 revenue recognition. Identity Automation is expected to perform well in Q3 due to the education sector's seasonality but will see a sequential revenue decline in Q4.
Q:How is progress with U.S. partners, and can this channel drive similar revenues to the international channel?
A:The U.S. partner network is growing, supported by a new partner portal and program. Over two-thirds of global business now comes from the channel, with rapid growth in the U.S. The company believes U.S. channel revenues can reach international levels.
Q:What is the demand for security solutions in the education sector and international markets?
A:Demand for security solutions is strong, driven by the need for integrated management and security. Growth is particularly notable in mobile, retail, transportation, professional services, and manufacturing sectors.
Q:Are there specific changes in sales rep quotas or focus areas in the go-to-market strategy?
A:The focus is on selling platform solutions that integrate management and security, targeting both small-to-medium businesses and enterprises. Investments are being made in enterprise sales resources to drive growth and reduce churn.
Q:Review of Unclear Management Responses
A:Management avoided providing specific numerical details on the magnitude of timing impacts for Q2 revenue recognition and the exact revenue contribution of Identity Automation for the rest of the year.
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Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI Assistant
AI sale
Android enrollment
Mobile mobility
Nation Live
Research Division
Zero
apps
automation
center
classroom
complexity
compliance
control security
defense
device application
district
efficiency AI
employee
enrollment support
event
forecasting
governance
health
identity
investment area
need
partner ecosystem
place
policy
resource
skill
technology
tool
user device
value
JAMF Transcript
Jamf Holding Corp. (JAMF) Q2 2025 Earnings Call Transcript
Positive8-8
The earnings call presented strong financial performance with a 15% revenue growth and improved margins. The Q&A highlighted strategic initiatives and positive traction in new markets, despite some economic uncertainties. The company has a substantial cash position and optimistic guidance for the year. The repurchase of convertible notes and strong ARR growth further support a positive outlook. The market cap indicates a potential 2-8% stock price increase over the next two weeks, classifying the sentiment as positive.
Jamf Holding Corp. (JAMF) Q1 2025 Earnings Call Transcript
Unknown5-6
Jamf's earnings call presented a mixed picture. Strong financial metrics, including revenue and cash flow growth, were offset by competitive pressures and regulatory concerns. The guidance was maintained, reflecting caution due to macroeconomic uncertainty. The lack of a share buyback program and slight decrease in free cash flow margin also weigh negatively. However, optimistic outlooks on new partnerships and the Identity Automation acquisition could mitigate some concerns. With a market cap of around $2 billion, the stock is unlikely to see significant short-term movement, leading to a neutral sentiment.
Jamf Holding Corp. (JAMF) Q4 2024 Earnings Call Transcript
Unknown2-27
The earnings call summary presents a mixed picture. Financial performance shows strong revenue growth and margin improvements, but guidance is weak, with a slight decrease in net retention rate. The Q&A session reveals management's confidence in security as a growth driver, yet they avoided specifics on achieving long-term goals and the impact of macroeconomic factors. The lack of a share repurchase plan and potential regulatory and economic risks further neutralize the outlook. Given the small-cap nature of the company, the stock price is likely to remain stable, resulting in a neutral sentiment.
Jamf Holding Corp. (JAMF) Q3 2024 Earnings Call Transcript
Unknown11-10
The earnings call reflects a mixed sentiment. While there is consistent revenue and ARR growth, competitive pressures and regulatory challenges pose risks. The lack of a shareholder return plan and muted guidance for Q4 suggest caution. However, strong security ARR growth and positive customer feedback at JNUC provide optimism. The market cap suggests moderate volatility. Overall, the sentiment is neutral, with potential upward movement limited by economic and competitive headwinds.
JAMF Report
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