Mon, May 12, 8:17 PM (31 days ago)
**Rapid7, Inc. (RPD) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $210.3 million (up 2.5% YoY), driven by product subscriptions ($203.9 million) and professional services ($6.3 million). - **Profit Margins:** Gross margin was 71.7%, with product subscriptions at 73.3% and professional services at 19.1%. - **Net Income:** $2.1 million, a decrease from $1.4 million in Q1 2024, with a net margin of 0.9%. - **Cash Flow:** Operating activities provided $29.8 million, with free cash flow at $24.7 million. **Key Metrics:** - **Annualized Recurring Revenue (ARR):** $837.2 million, up 3.7% YoY. - **Customer Base:** 11,685 customers, a 1.9% increase YoY. - **ARR per Customer:** $71.6, up 1.7% YoY. **Operational Highlights:** - **Expenses:** Total operating expenses were $150.9 million, with research and development at $47.9 million, sales and marketing at $79.4 million, and general and administrative at $23.6 million. - **Stock-Based Compensation:** $27.2 million, primarily in research and development and sales and marketing. - **Cash Position:** $291.5 million in cash and cash equivalents, with $301.1 million in investments. **Trends and Uncertainties:** - **Revenue Growth:** Driven by existing customer renewals and upsells, with new customer revenue partially offset by a decrease. - **Operating Expenses:** Increased investments in research and development, sales and marketing, and general and administrative functions. - **Future Operations:** Focus on innovation, customer acquisition, and strategic acquisitions to drive growth. **Future Outlook:** - **Liquidity:** Sufficient cash and investments to meet operating and capital requirements for at least the next 12 months. - **Capital Expenditures:** Expected to support infrastructure and workforce expansion, office facilities, and potential acquisitions. - **Commitments:** $660 million cloud services agreement with minimum annual commitments of $125 million over the next five years. **Risks and Challenges:** - **Economic Uncertainty:** Potential impacts on software spending and global economic volatility. - **Competition:** Increased competition and innovations by new and existing competitors. - **Integration:** Successful integration of acquired technologies and businesses. **Conclusion:** Rapid7, Inc. demonstrated steady revenue growth and strategic investments in Q1 2025. The company's focus on innovation, customer acquisition, and strategic acquisitions positions it for continued growth, despite economic uncertainties and competitive pressures.