Similarweb (SMWB) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $60.6 million, up 13% year-over-year, with annualized revenue at $243 million and accelerated growth driven by new customer acquisition and improved retention.

• Customer base expanded to 5,034, including the first eight-figure ARR customer and 383 $100K+ ARR customers.

• Launched a significantly improved digital data estimation version, expanding coverage by 30 million websites.

• Acquired 42matters AG to enhance app intelligence capabilities and provide a holistic digital view.

• Raised full-year 2024 guidance for both revenue and non-GAAP operating profit.

Financial highlights

• Non-GAAP gross margin improved to 82% in Q2 2024, up from 79% in Q2 2023.

• Non-GAAP operating profit was $5.3 million (9% margin) in Q2 2024, marking the fourth consecutive quarter of non-GAAP operating profit.

• Free cash flow was $6.3 million in Q2 and $16 million for the first half of 2024.

• Remaining performance obligations (RPO) totaled $217 million, up 24% year-over-year, with 75% expected to be recognized in the next 12 months.

• GAAP operating loss narrowed to $1.0 million (2% of revenue) from $9.8 million (18%) in Q2 2023.

Outlook and guidance

• Q3 2024 revenue expected at $62.5–$63 million, representing about 15% year-over-year growth at midpoint.

• Full-year 2024 revenue guidance raised to $246–$248 million; non-GAAP operating profit guidance increased to $13–$15 million.

• Expect to remain profitable on a non-GAAP basis and generate positive free cash flow in all remaining quarters of 2024.

• Management targets long-term 85% gross margin, 25% operating margin, and 30% normalized free cash flow margin.

• Management sees a large and expanding market opportunity, with a $52 billion TAM.