OneStream (OS) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue grew 21% year-over-year to $129.1M, driven by 39% subscription revenue growth to $110.7M and customer expansion to 1,534, up 18% year-over-year.

• Free cash flow was positive for Q3 and the trailing 12 months, with over $60M generated in the past year.

• Completed IPO in July 2024, raising $409.6M in net proceeds, with $352.9M used to purchase LLC Units and $56.7M for a synthetic secondary transaction.

• Net loss was $249.3M for Q3 2024, primarily due to a $260M equity-based compensation expense from IPO-related option modifications.

• Continued innovation with 15 new product introductions in 2024, including AI-powered features and expanded regulatory reporting solutions.

Financial highlights

• Subscription revenue: $110.7M in Q3 2024, up 39% year-over-year; total revenue: $129.1M, up 21% year-over-year.

• License revenue declined to $11.7M in Q3 2024 due to SaaS conversions.

• Professional services revenue was $6.7M, reflecting more partner-led implementations.

• Non-GAAP gross margin was 71% in Q3 2024; software gross margin was 74%.

• Non-GAAP operating income was $5.5M (4% margin); GAAP operating loss was $255.2M, driven by equity-based compensation.

Outlook and guidance

• Q4 2024 revenue guidance: $127M–$129M; full-year 2024: $484M–$486M.

• Q4 non-GAAP operating margin expected at 0%–2%; full-year at (2)%–(1)%.

• Q4 non-GAAP net income per share: $0.01–$0.03; full-year: $0.06–$0.08.

• Equity-based compensation for Q4 projected at $50M–$55M; full-year $315M–$320M.

• Management expects SaaS contracts to continue increasing as a share of total revenue, with ongoing investments in R&D, sales, and international expansion.