Q1 2024 HubSpot Inc Earnings Call Transcript
Key Points
- HubSpot Inc (HUBS) reported a solid revenue growth of 23% year-over-year in constant currency for Q1 2024.
- Operating margin grew by 120 basis points year-over-year, reaching 15%.
- Total customer count increased by 22% year-over-year to over 215,000, driven by significant net customer additions.
- Strong product innovation with over 100 new product releases, including 70 AI features, launched in the Spring Spotlight event.
- High customer dollar retention in the high 80s, indicating strong value delivery to existing customers.
- Experienced weaker demand conditions in Q1 2024, similar to the challenges faced in 2023, with increased scrutiny on budgets and more decision-makers involved in the purchasing process.
- The shift from higher quality inbound and partner-sourced leads to lower quality rep-sourced leads, which slowed down deal progression.
- The introduction of a new pricing model based on seats in March negatively impacted business, with a faster adoption leading to lower ASPs and a slower pickup in new customer volume.
- Despite maintaining full-year revenue guidance, the company noted ongoing macroeconomic challenges and a cautious buying environment expected to persist through 2024.
- Upgrade rates were challenged in Q1, although gross retention remained strong.
Good afternoon, and welcome to the HubSpot First Quarter 202 Earnings Conference Call. My name is Harry, and I'll be your operator today. (Operator Instructions)
And I will now hand over to Ryan Burkart, Senior Director of Investor Relations, to begin. Please go ahead.
Thanks, operator. Good afternoon, and welcome to HubSpot's First Quarter 2024 Earnings Conference Call. Today, we'll be discussing the results announced in the press release that was issued after the market closed. With me on the call this afternoon is Yamini Rangan, our Chief Executive Officer; Dharmesh Shah, our Co-Founder and CTO; and Kate Bueker, our Chief Financial Officer.
Before we start, I'd like to draw your attention to the safe harbor statement included in today's press release. During this call, we'll make statements related to our business that may be considered forward-looking within the meaning of Section 27A of the Securities Exchange Act of 1933 as amended and Section 21E of the Securities Exchange Act of 1934 as amended.
All statements other
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