Couchbase (BASE) Q3 2025 earnings summary

Executive summary

• Q3 FY2025 revenue grew 13% year-over-year to $51.6 million, with ARR up 17% to $220.3 million and Capella now representing 15.1% of ARR and one third of the customer base.

• Customer count reached 903, with 302 customers generating over $100K ARR and 46 exceeding $1M ARR.

• Capella adoption accelerated, highlighted by the largest migration in company history and new AI services launch.

• Operational efficiency improved, with Rule of 40 score up 9 points year-over-year and non-GAAP operating margin improving to -6.7%.

• Subscription revenue comprised over 90% of total revenue, with services revenue making up the remainder.

Financial highlights

• Q3 total revenue was $51.6 million, up 13% year-over-year; ARR reached $220.3 million, up 17% year-over-year.

• Capella ARR grew 15% sequentially to $33.2 million.

• Non-GAAP gross margin was 88.2%, with software gross margin at 90.8%.

• Non-GAAP operating loss was $3.5 million (-7% margin), improved from $5 million loss (-11% margin) last year.

• Cash, cash equivalents, and short-term investments totaled $141.9 million at quarter end.

Outlook and guidance

• Q4 revenue expected between $52.7M–$53.5M; full-year revenue guidance is $207.2M–$208M.

• Q4 ARR guidance is $236.5M–$239.5M; full-year ARR guidance matches this range.

• Free cash flow expected to turn positive in fiscal 2026; non-GAAP operating loss guidance improved to -$20M to -$19M for the year.

• Medium-term goals include 20%+ growth, positive free cash flow in FY26, and non-GAAP operating income in FY27.

• Existing liquidity is expected to be sufficient for at least the next 12 months.