Pros (PRO) Q2 2024 earnings summary

Executive summary

• Q2 2024 total revenue reached $82.0M, up 8% year-over-year, with subscription revenue at $65.6M, up 14% year-over-year.

• Non-GAAP subscription gross margin reached 80%, achieving a long-term goal, with GAAP margin at 78%.

• Net loss narrowed to $7.4M from $13.3M in Q2 2023; non-GAAP EPS was $0.07.

• Free cash flow was $6.2M in Q2, up from negative $6.2M in Q2 2023, and operating cash flow turned positive.

• Achieved significant industry recognition, including Microsoft Partner of the Year and top G2 rankings.

Financial highlights

• Q2 subscription revenue: $65.6M (up 14% YoY); total revenue: $82M (up 8% YoY); recurring revenue was 84% of total.

• Adjusted EBITDA improved to $5.2M in Q2, up from $0.1M a year ago.

• Free cash flow for Q2 was $6.2M; trailing twelve months FCF was $23.4M.

• Gross revenue retention rate exceeded 93% for Q2 2024 TTM.

• GAAP gross profit for Q2 2024 was $53.2M, up 13% year-over-year.

Outlook and guidance

• FY24 total revenue guidance: $329M–$331M (9% growth at midpoint); subscription revenue $263.5M–$265.5M (13% growth at midpoint).

• FY24 free cash flow guidance: $20M–$24M; adjusted EBITDA guidance: $21M–$24M.

• Q3 2024 guidance: total revenue $81.5M–$82.5M, subscription revenue $65.8M–$66.3M, non-GAAP EPS $0.08–$0.10.

• Rule of 40 goal achievement delayed by about one year due to airline sector headwinds.

• Focus remains on profitable growth, leveraging AI, and improving operational efficiency.