Tenable (TENB) Piper Sandler Growth Frontiers Conference summary

Market environment and demand drivers

• Federal and public sector business remains strong, representing about 15% of revenue, with a healthy pipeline for Q3, though Q4 and Q1 may be challenging due to election cycle uncertainties.

• Optimism for 2025 is high, with expectations of double-digit growth in vulnerability management (VM) and positive customer planning trends.

• The VM market is experiencing cyclical, not secular, pressure, with a digestion period following strong procurement from 2020-2022 and anticipated budget recovery in 2025.

• The attack surface is expanding due to legacy systems, cloud adoption, AI, and mobile workforces, increasing the need for comprehensive risk management.

• Regulatory requirements and hybrid environments are driving demand for broader and more integrated security solutions.

Platform strategy and product evolution

• Exposure management is emerging as a key discipline, with platforms like Tenable One integrating VM, cloud, OT, identity, and analytics for holistic risk assessment.

• Customers are moving from hundreds of point solutions to a handful of best-of-breed platforms, but not consolidating to a single vendor.

• Tenable One has achieved 10% penetration in the enterprise base and accounts for 30% of net new sales, commanding a 70% higher ASP than standalone VM.

• Recent acquisitions, such as Eureka for data security posture management, are expanding platform capabilities, with further growth expected in SaaS security posture management.

• Integration of OT and cloud security into Tenable One is ongoing, expected to further increase platform adoption and strategic value.

Competitive landscape and market opportunities

• The cloud security market is dynamic, with multiple strong players and rapid change; no single winner is expected to dominate.

• Tenable’s solutions are positioned as top-tier, especially for hybrid enterprises needing unified risk assessment across cloud and on-prem environments.

• OT security is a growing but slow-moving market, with increasing CISO responsibility and significant, though lumpy, deal sizes.

• Exposure management solutions are projected to grow twice as fast as attack detection and response technologies by 2028.

• The company is seeing strong traction in cloud, web app security, and ASM, with 50% of new sales from non-VM SKUs.