HubSpot Inc (HUBS, Financial), a cloud-based marketing, sales, and customer service software platform, announced its financial results for the second quarter ended June 30, 2024. The company reported total revenue of $637.2 million, a 20% increase compared to Q2 2023, surpassing the analyst estimate of $619.44 million. Subscription revenue also saw a 20% rise, reaching $623.8 million.
Financial Performance and Challenges
HubSpot Inc (HUBS, Financial) reported a GAAP operating loss of $23.9 million, a significant improvement from the $116.2 million loss in Q2 2023. The GAAP operating margin improved to -3.8% from -22.0% in the previous year. Non-GAAP operating income was $109.3 million, up from $76.6 million in Q2 2023, with a non-GAAP operating margin of 17.2%, compared to 14.5% in the same period last year.
Despite the positive revenue growth, HubSpot Inc (HUBS, Financial) faced challenges with a GAAP net loss of $14.4 million, or $0.28 per share, compared to a net loss of $111.8 million, or $2.25 per share, in Q2 2023. However, non-GAAP net income was $103.5 million, or $2.03 per basic share and $1.94 per diluted share, compared to $71.8 million, or $1.45 per basic share and $1.38 per diluted share, in Q2 2023.
Key Financial Achievements
HubSpot Inc (HUBS, Financial) achieved several financial milestones in Q2 2024:
- Total revenue of $637.2 million, up 20% year-over-year.
- Subscription revenue of $623.8 million, up 20% year-over-year.
- Professional services and other revenue of $13.5 million, up 18% year-over-year.
- Non-GAAP operating income of $109.3 million, up from $76.6 million in Q2 2023.
- Non-GAAP net income of $103.5 million, up from $71.8 million in Q2 2023.
These achievements are crucial for HubSpot Inc (HUBS, Financial) as they reflect the company's ability to grow its customer base and increase revenue despite market challenges.
Income Statement Highlights
| Metric | Q2 2024 | Q2 2023 |
|---|---|---|
| Total Revenue | $637.2 million | $529.1 million |
| GAAP Operating Loss | ($23.9) million | ($116.2) million |
| Non-GAAP Operating Income | $109.3 million | $76.6 million |
| GAAP Net Loss | ($14.4) million | ($111.8) million |
| Non-GAAP Net Income | $103.5 million | $71.8 million |
Balance Sheet and Cash Flow
HubSpot Inc (HUBS, Financial) reported a strong balance sheet with cash, cash equivalents, and short-term and long-term investments totaling $1.9 billion as of June 30, 2024. The company generated $117.8 million in cash from operating activities, compared to $76.5 million in Q2 2023. Non-GAAP free cash flow was $92.1 million, up from $59.6 million in the same period last year.
Customer Growth and Revenue Per Customer
HubSpot Inc (HUBS, Financial) grew its customer base to 228,054 as of June 30, 2024, a 23% increase from the previous year. However, the average subscription revenue per customer decreased by 2% to $11,215 during the second quarter of 2024.
“Q2 was another solid quarter of revenue growth and profitability driven by our rapid pace of innovation and consistent execution,” said Yamini Rangan, Chief Executive Officer at HubSpot. “I am thrilled to see customers consolidating on HubSpot and the momentum we have in becoming the customer platform of choice for scaling companies.”
Analysis and Outlook
HubSpot Inc (HUBS, Financial) has demonstrated robust revenue growth and improved profitability metrics, indicating strong operational performance. The company's ability to increase its customer base and maintain high subscription revenue is a positive sign for future growth. However, the slight decline in average subscription revenue per customer may require attention to ensure sustained revenue growth.
Overall, HubSpot Inc (HUBS, Financial) has shown resilience and strategic execution in Q2 2024, positioning itself well for continued success in the competitive software industry.
Explore the complete 8-K earnings release (here) from HubSpot Inc for further details.
