Similarweb (SMWB) Q1 2025 earnings summary

Executive summary

• Q1 2025 revenue grew 14% year-over-year to $67.1 million, with annualized revenue at $268 million and customer base expanding 19% to 5,767, including over 5,700 ARR customers.

• Achieved sixth consecutive quarter of positive free cash flow, generating $4.4–$5 million in Q1 2025, driven by investments in sales, R&D, and successful AI-driven product launches.

• Accelerated sales hiring, with over 80% of new hires expected to be fully ramped by Q3, supporting anticipated growth in the second half of the year.

• Recognized as a leader in G2's Spring 2025 report, earning 90 badges and leadership across all business sizes and regions.

• Launched new AI-powered products, including App Intelligence, AI Chatbot Traffic Intelligence, and three AI Agents, expanding app data coverage and customer insights.

Financial highlights

• Q1 2025 revenue reached $67.1 million, up 14% year-over-year, with 19% customer growth and upsells.

• Non-GAAP gross margin was 80%, maintaining strong profitability; non-GAAP operating loss was $(1.3) million (2% margin).

• Normalized free cash flow was $4.9–$5 million (7% margin), marking the sixth straight quarter of positive free cash flow.

• Remaining performance obligations (RPO) totaled $252.7–$253 million, up 18% year-over-year, with 69% expected to be recognized as revenue in the next 12 months.

• 52% of ARR is under multi-year contracts, up from 42% a year ago; 61% of ARR comes from $100K+ ARR customers.

Outlook and guidance

• Full-year 2025 revenue guidance is $285–$288 million, representing 15% year-over-year growth at midpoint.

• Non-GAAP operating profit for 2025 expected between $1 million and $4 million.

• Q2 2025 revenue expected at $68.6–$69 million; non-GAAP operating loss projected at $(1.0)–$(0.5) million.

• Long-term model targets: 85% gross margin, 25% operating margin, and 30% normalized free cash flow margin.

• Guidance incorporates a 1–2% FX headwind and is based on conservative, achievable assumptions.