Five9 (FIVN) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue grew 15% year-over-year to $264.2M, with subscription revenue up 20% and record operating cash flow of $41.1M.

• Adjusted EBITDA margin reached 19.8%–20%, and non-GAAP net income was $50.5M or $0.67 per diluted share.

• AI products drove significant momentum, comprising over 20% of enterprise new logo ACV bookings and 100% attachment to $1M+ ARR new logo deals.

• Acquisition of Acqueon for $173.8M expanded omnichannel and AI-powered outbound capabilities.

• Leadership strengthened with new Chief Product Officer and vertical initiatives in AI and healthcare.

Financial highlights

• Q3 revenue was $264.2M, up 15% year-over-year; subscription revenue made up nearly 80% of total revenue.

• Adjusted EBITDA for Q3 2024 was $52.4M (19.8% of revenue), up from $41.3M in Q3 2023.

• Adjusted gross margin was 61.8% in Q3 2024, up from 60.6% in Q3 2023.

• Q3 non-GAAP EPS was $0.67, up $0.15 from Q3 2023; record quarterly operating cash flow of $41.1M.

• GAAP net loss narrowed to $4.5M, or $0.06 per share, including a $9.6M one-time RIF charge and $4.8M tax benefit from Acqueon acquisition.

Outlook and guidance

• Q4 2024 revenue guidance midpoint raised to $267.5M; full-year 2024 revenue guidance midpoint raised to $1.031B.

• Q4 non-GAAP EPS guidance midpoint raised to $0.70; full-year non-GAAP EPS guidance midpoint raised to $2.37.

• 2025 revenue expected to align with Street consensus of $1.13B, with potential upside if macro improves.

• 2025 non-GAAP EPS expected to surpass $2.52; adjusted EBITDA margin increases anticipated.

• Capital expenditures for 2024 projected at $46M–$47M.