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Cybersecurity software maker Tenable (NASDAQ:TENB) reported revenue ahead of Wall Street’s expectations in Q1 CY2025, with sales up 10.7% year on year to $239.1 million. The company expects next quarter’s revenue to be around $242 million, close to analysts’ estimates. Its non-GAAP profit of $0.36 per share was 27.5% above analysts’ consensus estimates.

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Tenable (TENB) Q1 CY2025 Highlights:

• Revenue: $239.1 million vs analyst estimates of $233.6 million (10.7% year-on-year growth, 2.4% beat)

• Adjusted EPS: $0.36 vs analyst estimates of $0.28 (27.5% beat)

• Adjusted Operating Income: $48.68 million vs analyst estimates of $41.86 million (20.4% margin, 16.3% beat)

• The company reconfirmed its revenue guidance for the full year of $975 million at the midpoint

• Operating Margin: -7.4%, down from -4.1% in the same quarter last year

• Free Cash Flow Margin: 33.5%, similar to the previous quarter

• Net Revenue Retention Rate: 108%, in line with the previous quarter

• Annual Recurring Revenue: $1.07 billion at quarter end, up 20.1% year on year

• Billings: $214.3 million at quarter end, up 13.9% year on year

• Market Capitalization: $4.09 billion

StockStory’s Take

Tenable’s first quarter results were shaped by notable momentum in its exposure management platform, Tenable One, which management said was central to landing the highest number of seven-figure deals in company history. Co-CEOs Steve Vintz and Mark Thurmond credited the platform’s ability to unify risk insights across cloud, on-premise, and operational technology environments for expanding deal sizes and driving customer upgrades, particularly in regulated sectors such as finance and the public sector.

Looking ahead, Tenable’s leadership reaffirmed its annual revenue guidance but indicated a more cautious approach due to economic and geopolitical uncertainties, especially in the U.S. public sector. Vintz explained, “There’s just more uncertainty now since our February call than there was early in the year,” citing longer procurement cycles and leadership changes in government agencies as reasons for a more conservative outlook. The company’s strategy for the year centers on continued investment in platform innovation and expanding integrations, balanced with operating discipline.

Key Insights from Management’s Remarks

Tenable’s management pointed to exposure management momentum, a shifting competitive landscape, and evolving customer priorities as the key factors influencing quarterly results and outlook.

• Exposure Management Platform Adoption: Tenable One continued to drive large deal wins, with management attributing heightened customer interest to its ability to integrate vulnerability, cloud, and operational technology risk into a unified solution, leading to broader platform adoption and higher average selling prices.

• Cloud Security and AI Initiatives: The company observed outsized growth in its cloud security offerings, and highlighted the operationalization of AI-aware discovery capabilities. Management cited increased detection of AI-related applications and vulnerabilities, positioning Tenable to address emerging risks tied to artificial intelligence adoption.

• Vulcan Cyber Acquisition Integration: The integration of Vulcan Cyber is broadening Tenable One’s analytics by incorporating third-party security data, which management believes will further differentiate the platform and enable more actionable remediation workflows for customers.

• Competitive Landscape Shifts: Management noted that the acquisition of Wiz by Google has created new opportunities for Tenable, as customers with multi-cloud environments seek alternatives to vendor lock-in. Tenable reported higher win rates against both legacy vulnerability management and endpoint security competitors.

• Public Sector Headwinds: Leadership acknowledged increased uncertainty in the U.S. federal market due to government leadership changes and extended procurement cycles. Despite closing notable public sector deals, Tenable anticipates more cautious spending and delayed purchasing decisions from these customers.