HubSpot (HUBS) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue grew 20% year-over-year to $637.2 million, with customer count rising 23% to 228,054 and strong multi-hub adoption driving growth.

• Operating margin expanded to 17% (non-GAAP), with non-GAAP net income reaching $103.5 million ($1.94 per diluted share).

• Product innovation, including Service Hub updates, Content Hub launch, and AI-powered enhancements, contributed to customer wins and higher attach rates.

• Free cash flow for Q2 was $92 million (14% margin), with trailing twelve-month FCF at $344 million.

• International revenue comprised 47% of total revenue, with a global presence in over 135 countries.

Financial highlights

• Q2 2024 total revenue: $637.2 million, up 20% year-over-year; subscription revenue: $623.8 million, up 20%.

• Non-GAAP operating margin was 17.2%, up from 14.5% in Q2'23; GAAP operating margin improved to -3.8% from -22.0%.

• Net income (non-GAAP) was $103.5 million; GAAP net loss narrowed to $14.4 million from $111.8 million in Q2 2023.

• Cash, cash equivalents, and investments totaled $1.9 billion at quarter end.

• Calculated billings reached $648 million, up 20% year-over-year.

Outlook and guidance

• Q3 2024 revenue expected at $646–$647 million; non-GAAP operating profit $107–$108 million.

• Full-year 2024 revenue expected at $2.567–$2.573 billion; non-GAAP operating profit $437–$441 million.

• CapEx expected at 4–5% of revenue; free cash flow guidance for 2024 is $380 million.

• Guidance assumes persistent macroeconomic challenges and neutral FX impact.

• Long-term target model: 81%-83% gross margin, 20% R&D, 30%-35% S&M, 8% G&A, 20%-25% operating margin.