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HubSpot, Inc. HUBS reported impressive first-quarter 2025 results, with both the adjusted earnings and revenues beating the respective Zacks Consensus Estimate.
The software-as-a-service vendor reported a top-line expansion year over year, backed by growing user engagement across all segments. The integration of advanced AI tools, which include state-of-the-art features, such as AI assistance, AI agents, AI insights and ChatSpot, across its entire product suites and customer platform is driving more value to customers. The growing adoption of inbound applications is a tailwind.
Net Income
On a GAAP basis, the company recorded a net loss of $21.8 million or a loss of 42 cents per share against a net income of $5.9 million or 12 cents per share in the year-ago quarter.
Non-GAAP net income was $95.9 million or $1.78 per share, up from $89.1 million or $1.68 per share in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 4 cents. (Find the latest EPS estimates and surprises on Zacks Earnings Calendar.)
HubSpot, Inc. Price, Consensus and EPS Surprise
HubSpot, Inc. price-consensus-eps-surprise-chart | HubSpot, Inc. Quote
Revenues
Quarterly revenues improved to $714.1 million from $617.4 million reported in the year-ago quarter. The company is witnessing steady multi-hub adoption from enterprise customers in the premium market. Demand for sales hub remains strong. Healthy net customer additions in the starter edition, along with pricing optimization, drove net sales in the lower tier of the market spectrum. The top line beat the Zacks Consensus Estimate of $699 million.
HubSpot added more than 10000 net new customers during the quarter, which increased the total customer count to 258,258, up 19% year over year.
Subscription revenues rose to $698.7 million from $603.8 million, up 16% year over year. The figure surpassed the Zacks Consensus Estimate of $659.33 million. Average subscription revenues per customer declined 4% year over year to $11,038.
Professional services and other revenues totaled $15.4 million, up from $13.6 million in the year-ago quarter. The top line beat the Zacks Consensus Estimate of $14.42 million.
Other Details
Gross profit in the quarter was $599 million, up from $522.3 million in the year-ago quarter. Operating loss, on a GAAP basis, was $27.5 million compared with $23.2 million in the year-ago quarter. Non-GAAP operating income improved to $100.3 million from $92.6 million, with respective margins of 14% and 15%.
Cash Flow & Liquidity
In the first quarter of 2025, the company generated $161.6 million in cash from operating activities compared with $127.1 million cash generated in the year-ago quarter. As of March 31, 2025, HubSpot had $625 million in cash and cash equivalents, with $368.9 million in convertible senior notes.