Semrush (SEMR) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached $91 million, up 22% year-over-year, with ARR at $377.7 million, up 25% year-over-year.

• Non-GAAP operating income was $12.2 million, with a non-GAAP operating margin of 13.4%, up from 3.1% in the prior year period.

• Net income attributable to the company was $1.7 million for Q2 2024, reversing a net loss in the prior year.

• Over 116,000 paying customers as of June 30, 2024, up 11.5% year-over-year; enterprise customers paying over $10,000 annually grew 37%.

• Recent acquisitions (Brand24, Ryte, and Datos) expanded capabilities in social media, brand marketing, technical SEO, and data.

Financial highlights

• Q2 2024 revenue: $91 million, up 22% year-over-year; ARR for the quarter grew 25% to $377.7 million.

• Non-GAAP operating margin improved to 13.4%, up over 1,000 basis points year-over-year.

• Cash flow from operations in Q2 was $12.1 million; free cash flow for the first half of 2024 was $19.65 million.

• Gross margin for Q2 2024 was 84%, up from 83% in Q2 2023.

• Dollar-based net revenue retention remained at 107%.

Outlook and guidance

• Q3 2024 revenue expected between $96 million–$97 million, representing ~23% year-over-year growth.

• Full-year 2024 revenue guidance raised to $373 million–$375 million, up 21–22% year-over-year.

• Full-year non-GAAP operating margin expected between 10.5–11.5%; free cash flow margin around 8%.

• Brand24 and Ryte expected to contribute about 200 basis points of growth.

• Existing cash, cash equivalents, and short-term investments of $231.5 million expected to be sufficient for at least the next 12 months.