Tenable (TENB) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue reached $227.1 million, up 13% year-over-year, with recurring revenue at 96% and calculated current billings at $248.4 million, up 11% year-over-year.

• Delivered record unlevered free cash flow of $60.8 million and strong momentum in exposure management and cloud security, with Tenable One and Cloud Security as top spending priorities.

• Non-GAAP operating margin improved to 20%, while GAAP net loss narrowed to $9.2 million from $15.6 million in Q3 2023.

• Acquired Eureka Security, Inc. for $29.2 million to enhance cloud data security capabilities.

• Stock repurchase authorization increased by $200 million, with $64.9 million spent through Q3 2024.

Financial highlights

• Q3 2024 revenue was $227.1 million, up 13% year-over-year; calculated current billings were $248.4 million, up from $224.7 million in Q3 2023.

• Non-GAAP gross margin was 81%; GAAP gross margin was 78% in Q3 2024.

• Non-GAAP operating margin reached 20%, up from 18% in Q3 2023; non-GAAP EPS was $0.32.

• Unlevered free cash flow was $60.8 million for Q3 and $152 million year-to-date; free cash flow for the nine months ended September 30, 2024, was $128.5 million.

• Cash and short-term investments totaled $548.4 million at quarter end.

Outlook and guidance

• Q4 2024 revenue expected between $229 million and $233 million; non-GAAP operating income $47–$49 million; non-GAAP EPS $0.33–$0.35.

• FY 2024 revenue guidance is $893.3–$897.3 million; calculated current billings $957–$967 million; unlevered free cash flow forecasted at $225–$235 million; non-GAAP EPS $1.21–$1.23.

• Management expects continued investment in sales, marketing, and R&D, with operating losses anticipated in the near term.

• Existing cash, cash equivalents, and short-term investments are expected to fund operations for at least the next 12 months.