10-Q - SEMrush Holdings, Inc. (0001831840) (Filer)

Thu, May 8, 8:34 PM (4 days ago)

**Semrush Holdings, Inc. (SEMR) Q1 2025 Financial Summary** **Financial Health and Performance:** - **Revenue:** $105.02 million, up 22% YoY from $85.81 million. - **Gross Profit:** $85.15 million, up 20% YoY from $71.17 million. - **Gross Margin:** 81%, down from 83% YoY. - **Operating Income:** $(74,000), down from $1.47 million YoY. - **Net Income:** $655,000, down from $2.00 million YoY. - **EPS:** $0.01, unchanged YoY. - **Cash Flow from Operations:** $22.11 million, up from $14.78 million YoY. - **Free Cash Flow:** $18.51 million, up from $12.01 million YoY. **Profit Margins:** - **Operating Margin:** -0.1% (loss), down from 1.7% YoY. - **Net Margin:** 0.6%, down from 2.3% YoY. **Cash Flow:** - **Operating Cash Flow:** $22.11 million, up 50% YoY. - **Investing Cash Flow:** $(5.69 million), improved from $(32.00 million) YoY. - **Financing Cash Flow:** $(345,000), down from $434,000 YoY. **Earnings Changes:** - **Revenue Growth:** 22% YoY, driven by increased paying customers and upsell/cross-sell activities. - **Operating Income Decline:** Due to increased operating expenses, particularly in sales and marketing, and research and development. - **Net Income Decline:** Due to higher provision for income taxes and increased operating expenses. **Quarterly Performance Discussion:** - **Revenue Growth:** Strong upsell and cross-sell activities, and an increase in paying customers. - **Operating Expenses:** Increased investments in sales and marketing, and research and development. - **Cash Flow:** Strong operating cash flow, improved investing cash flow. **Trends and Uncertainties:** - **Positive Trends:** Increased paying customers, strong upsell/cross-sell activities, and improved cash flow. - **Uncertainties:** Global economic conditions, foreign currency exchange risks, and potential impacts from geopolitical events. **Future Operations Impact:** - **Investments:** Continued investments in product development, sales and marketing, and general and administrative functions. - **Expansion:** Potential expansion into new markets and strategic acquisitions. - **Innovation:** Focus on AI and other technological advancements to enhance the platform.