Confluent (CFLT) Q3 2025 earnings summary

Executive summary

• Q3 2025 revenue reached $298.5M, up 19% year-over-year, with subscription revenue at $286.3M (+19% YoY) and cloud revenue at $161M (+24% YoY), now 54–56% of subscription revenue.

• Achieved non-GAAP profitability and surpassed a $1B revenue run rate, with net loss narrowing to $66.5M and non-GAAP net income per diluted share at $0.13.

• Dollar-based net retention rate stabilized at 114%, with 1,487 customers generating $100K+ in ARR (+10% YoY), and $1M+ ARR customers up 27% to 234.

• Flink ARR for Confluent Cloud grew over 70% sequentially, with more than 1,000 Flink customers and increasing depth of adoption.

• Partner ecosystem sourced over 25% of new business in the last 12 months, up from 20% last quarter.

Financial highlights

• Subscription revenue for Q3 2025 was $286.3M (+19% YoY), representing 96% of total revenue; cloud revenue was $161M (+24% YoY), and Confluent Platform revenue was $125.4M (+14% YoY).

• GAAP operating loss improved to $(83.3)M; non-GAAP operating margin rose to 9.7% (+340 bps YoY); adjusted free cash flow margin reached 8.2%.

• Net income per share (non-GAAP, diluted) was $0.13; cash and equivalents totaled $1.99B at quarter-end.

• Gross margin for Q3 2025 was 74% (GAAP) and 78.2% (non-GAAP); services revenue was $12.2M (+18% YoY).

• U.S. revenue was $172.1M (+13% YoY); international revenue was $126.4M (+29% YoY), accounting for 42% of total revenue.

Outlook and guidance

• Q4 2025 subscription revenue expected at $295.5M–$296.5M (+18% YoY); non-GAAP operating margin ~7%; net income per diluted share $0.09–$0.10.

• FY 2025 subscription revenue guidance: $1.1135B–$1.1145B (+21% YoY); non-GAAP operating margin ~7%; net income per diluted share $0.39–$0.40; adjusted free cash flow margin ~6%.

• Targeting long-term net dilution below 2% and stock-based compensation as a percentage of revenue in the mid-teens; expects quarterly GAAP profitability by FY'28.