Executive Summary

Q2 2025 total revenue grew 17% year over year to $170.6M, driven by cloud subscriptions up 21% to $106.9M; GAAP net loss was breakeven, non-GAAP net income was breakeven, and adjusted EBITDA was $8.1M .
Revenue and EPS beat Wall Street consensus: $170.6M actual vs $160.1M consensus; EPS ~$0.00 vs -$0.13 consensus, continuing a beat pattern from Q4 2024 and Q1 2025*.
Guidance raised meaningfully: FY 2025 revenue to $695–$703M (from $680–$688M), cloud to $429–$433M (from $419–$423M), adjusted EBITDA to $49–$55M (from $40–$46M), and non-GAAP EPS to $0.28–$0.36 (from $0.18–$0.26) .
Catalysts: raised FY guidance and a strong AI monetization narrative (“Appian AI drove strong financial results…with higher prices and a larger pipeline”) alongside Q3 outlook calling for continued double‑digit growth .

Values with asterisk are retrieved from S&P Global consensus estimates.

What Went Well and What Went Wrong

What Went Well

Cloud subscriptions revenue up 21% YoY to $106.9M; total subscriptions revenue up 17% YoY to $132.7M, with professional services up 13% YoY to $38.0M .
Operating performance improved: GAAP operating loss narrowed to $(11.0)M from $(39.2)M in Q2 2024; non‑GAAP operating swung to +$5.6M from $(13.1)M .
Management highlighted AI pricing tiers and pipeline strength: “Appian AI drove strong financial results…with higher prices and a larger pipeline.” — Matt Calkins, CEO .

What Went Wrong

GAAP operating loss persists at $(11.0)M despite improvement .
Cloud subscriptions revenue retention rate declined to 111% vs 118% a year ago, reflecting moderated expansion dynamics .
Quarterly cash flow was mixed: net cash used by operating activities was $(1.9)M in Q2 (though six‑month operating cash flow was +$43.0M) .

Financial Results

Actuals vs Consensus (oldest → newest)

Metric	Q4 2024	Q1 2025	Q2 2025
Revenue ($USD Millions) - Actual	$166.7	$166.4	$170.6
Revenue ($USD Millions) - Consensus*	$164.3	$163.3	$160.1
Primary EPS ($USD) - Actual (non-GAAP)	$0.00	$0.13	~$0.00
Primary EPS ($USD) - Consensus*	-$0.011	$0.031	-$0.128

Values with asterisk are retrieved from S&P Global.

Margins (Q2 year-over-year comparison)

Metric	Q2 2024	Q2 2025
Subscriptions Gross Margin %	88.3%	87.1%
Professional Services Gross Margin %	21.9%	29.5%
Total Gross Margin % (GAAP)	—	74.3%

Revenue Mix

Metric ($USD Millions)	Q2 2024	Q2 2025
Cloud Subscriptions	$88.4	$106.9
Term License Subscriptions	$17.2	$17.7
Maintenance & Support	$7.3	$8.0
Total Subscriptions	$113.0	$132.7
Professional Services	$33.5	$38.0
Total Revenue	$146.5	$170.6

KPIs

KPI	Q4 2024	Q1 2025	Q2 2025
Cloud Subscriptions Revenue Retention Rate	116%	112%	111%
Adjusted EBITDA ($USD Millions)	$21.2	$16.8	$8.1

Guidance Changes

Metric	Period	Previous Guidance (May 8, 2025)	Current Guidance (Aug 7, 2025)	Change
Cloud Subscriptions Revenue	FY 2025	$419–$423M	$429–$433M	Raised
Total Revenue	FY 2025	$680–$688M	$695–$703M	Raised
Adjusted EBITDA	FY 2025	$40–$46M	$49–$55M	Raised
Non-GAAP EPS	FY 2025	$0.18–$0.26	$0.28–$0.36	Raised
Cloud Subscriptions Revenue	Q3 2025	—	$109–$111M	New
Total Revenue	Q3 2025	—	$172–$176M	New
Adjusted EBITDA	Q3 2025	—	$9–$12M	New
Non-GAAP EPS	Q3 2025	—	$0.03–$0.07	New

Earnings Call Themes & Trends

Topic	Previous Mentions (Q4 2024 and Q1 2025)	Current Period (Q2 2025)	Trend
AI monetization & pricing tiers	Tiered pricing adoption; half of new logos above base tier; focus on “AI in process”; $98.9M cloud Q4; adjusted EBITDA $21.2M	“Appian AI drove strong financial results…with higher prices and a larger pipeline.”	Strengthening monetization narrative
Federal/Public Sector dynamics	Cautious optimism; unusual on‑prem mix in Q4; pipeline solid; GAM suite priced at seven figures	Government agencies were 34.1% of Q2 revenue; U.S. federal 25.9%	Public sector mix rising
Cloud retention & expansion	Retention targeted 110–120%; Q1 retention 112%; explanations for dip due to prior downsells	Retention at 111% in Q2	Slightly lower but within target band
Data Fabric & agents	Data Fabric usage +166% YoY; “read/write, performance tuned, security layer”; agents priced by usage and subsidized initially	Emphasis on AI embedded inside processes in press release and MD&A	Continued platform differentiation
Partner ecosystem	Focused partners and “Champion partners” boosting pipeline	Multiple industry recognitions and partnerships (Gartner LCAP Leader; Chartis; Everest; Raft partnership)	Strengthening ecosystem

Note: Q2 2025 earnings call transcript could not be retrieved due to a document database inconsistency; themes reflect press release and 10‑Q narrative for current quarter and prior call transcripts [16: tool error].

Management Commentary

“Appian AI drove strong financial results in the second quarter of 2025, with higher prices and a larger pipeline.” — Matt Calkins, CEO & Founder .
Q1 perspective on AI adoption: “70% of our cloud customers have adopted AI… production AI usage last quarter grew by 7.9x… We had more AI usage in Q1 than in all 2024 put together.” — Matt Calkins .
Pricing uplift for AI tiers: “We’ve got it priced at 25% uplift… asking 25% to add AI.” — Matt Calkins .
Agents pricing and adoption: “You price [agents] by usage… we’re going to subsidize use of agents for the time being.” — Matt Calkins .

Q&A Highlights

Note: Q2 Q&A transcript unavailable; below highlights reflect persistent themes from Q1 and recent commentary.

Federal demand cadence and Q3 seasonality: no meaningful pull-forward in Q1; cautious optimism on Q3 federal spend .
Cloud net retention dip drivers: trailing metric mechanics; select downsells working through the calculation .
AI monetization specifics: ~25% pricing uplift for AI tiers; strong demand in document processing/intake use cases .
Agents pricing model: usage-based and initially subsidized to drive adoption .

Estimates Context

Q2 2025 revenue beat: $170.6M actual vs $160.1M consensus*; EPS beat: ~$0.00 actual vs -$0.13 consensus*.
Q1 2025 revenue beat: $166.4M actual vs $163.3M consensus*; EPS beat: $0.13 actual vs $0.03 consensus*.
Q4 2024 revenue beat: $166.7M actual vs $164.3M consensus*; EPS beat: $0.00 actual vs -$0.01 consensus*.

Values retrieved from S&P Global.

Key Takeaways for Investors

Guidance raised across FY 2025 revenue, cloud, adjusted EBITDA, and non‑GAAP EPS; expect continued double‑digit growth with Q3 outlook supportive .
AI monetization is gaining traction (higher pricing tiers, strong pipeline), with management emphasizing “AI in process” as a durable differentiation and pricing uplift (~25%) .
Mix shift is favorable: subscriptions margins remain best‑in‑class; professional services margins improved to 29.5% in Q2, supporting profitability progression .
Watch retention trajectory: cloud revenue retention at 111% (down from 118% YoY) — acceptable band but signals moderated expansion; monitor upsell momentum .
Operational cash flow is strong YTD ($43.0M for six months), but quarterly variability persists (Q2 operating cash $(1.9)M); underscores seasonality and FX swings .
Public sector exposure increased (Q2: 34.1% total; U.S. federal 25.9%); GAM and partnerships (Raft/INDOPACOM) expand strategic footprint, but federal variability warrants prudence .
Non-GAAP adjustments remain material (stock-based comp, litigation expenses related to Pegasystems, JPI amortization, FX gains/losses); interpret EPS and EBITDA with these exclusions in mind .

APPIAN CORP (APPN)·Q2 2025 Earnings Summary