Cyber security firm Rapid7 Q3 adj net income beats, partly driven by Microsoft partnership expansion
Overview
Rapid7 Q3 revenue grows 2% yr/yr, with ARR also increasing by 2%
Adjusted net income beats analyst expectations, reflecting strong financial performance
Company appoints Rafe Brown as new CFO, effective December 1, 2025
Outlook
Rapid7 expects Q4 2025 revenue between $214 mln and $216 mln
Company projects full-year 2025 revenue of $856 mln to $858 mln
Rapid7 anticipates full-year 2025 free cash flow of $125 mln to $135 mln
Result Drivers
AI-DRIVEN PLATFORM - Rapid7 attributes ARR growth to market validation of its AI-driven Command Platform
GO-TO-MARKET ENHANCEMENTS - Strategic go-to-market enhancements positioned Rapid7 to capitalize on demand for integrated security operations platforms
PARTNERSHIP EXPANSION - Expanded partnership with Microsoft aimed at advancing modern detection and response contributed to results
Key Details
Metric | Beat/Miss | Actual | Consensus Estimate |
Q3 EPS | $0.15 | ||
Q3 Adjusted Net Income | Beat | $41.91 mln | $34.19 mln (22 Analysts) |
Q3 Net Income | $9.80 mln | ||
Q3 Adjusted EBITDA | $43.51 mln | ||
Q3 Gross Margin | 70% | ||
Q3 Adjusted Operating Margin | 17% | ||
Q3 Basic EPS | $0.15 | ||
Q3 Gross Profit | $152.97 mln |
Analyst Coverage
The current average analyst rating on the shares is "hold" and the breakdown of recommendations is 7 "strong buy" or "buy", 17 "hold" and 1 "sell" or "strong sell"
The average consensus recommendation for the software peer group is "buy."
Wall Street's median 12-month price target for Rapid7 Inc is $23.00, about 18.8% above its November 3 closing price of $18.68
The stock recently traded at 9 times the next 12-month earnings vs. a P/E of 11 three months ago
Press Release:
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