Total Revenue

+22.5% (from $213.18M to $261.22M)

**Total Revenue increased by $48.04M due to revenue growth from expanded customer acquisition and higher subscription sales that built on the previous period's base. " " **

Operating Income (EBIT)

Shifted from +$84.68M to –$105.78M (declined by ~$190M)

**Despite higher revenue, Operating Income deteriorated dramatically as increased SG&A and R&D expenses, along with higher depreciation costs, overwhelmed operating efficiencies seen in the previous period. " " **

Net Income

Reversed from +$94.10M to –$88.05M

**Net Income moved from a strong positive result to a significant loss due to escalating operating costs and expense pressures that counterbalanced the revenue growth improvements from the prior period. " " **

Earnings Per Share (Basic)

Shifted from $0.30 to –$0.27

**EPS declined by $0.57 as deteriorating net income and increased operating losses translated into negative earnings per share, reflecting the adverse cost impact compared to the previous quarter’s positive figure. " " **

Depreciation & Amortization

Increased by ~59% (from $3.92M to $6.23M)

**Depreciation and Amortization surged due to higher capitalized internal-use software and increased property & equipment costs, building upon previous period investments that now incur greater non-cash charges. " " **

SG&A Expenses

Increased by ~20% (from $153.86M to $184.55M)

**SG&A expenses rose driven by increased personnel costs, higher marketing and administrative spending—including overhead and acquisition-related expenses—further straining margins compared to Q4 2023. " " **

R&D Expenses

Grew by ~32% (from $86.95M to $114.89M)

**R&D spending increased significantly due to an accelerated investment in innovation, with higher headcount, greater stock-based compensation, and additional acquisition-related costs, reinforcing growth ambitions from the earlier period. " " **

Subscription Revenue (Quarterly)

Q1 2025

Expected to be in the range of $245M to $246M, ~21% growth "

Expected to be in the range of $253M to $254M, ~22% to 23% growth "

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Non-GAAP Operating Margin (Quarterly)

Q1 2025

Approximately 2% "

Approximately 3% "

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Non-GAAP Net Income per Diluted Share (Quarterly)

Q1 2025

$0.05 "

$0.06 to $0.07 "

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Subscription Revenue (Annual)

FY 2025

Expected to be in the range of $916.5M to $917.5M, ~26% growth "

Expected to be in the range of $1.117B to $1.121B, ~21% to 22% growth "

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Non-GAAP Operating Margin (Annual)

FY 2025

Approximately 2% "

Approximately 6% "

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Non-GAAP Net Income per Diluted Share (Annual)

FY 2025

$0.25 "

$0.35 "

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Free Cash Flow Margin (Annual)

FY 2025

Between 0% to 1% "

Approximately 6% "

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Cloud Subscription Revenue Mix (Annual)

FY 2025

no prior guidance

Expected to see ~1 point of increase each quarter, with a Q4 '25 exit at ~59% to 60% "

no prior guidance

Financial Performance and Revenue Guidance

Q1, Q2, and Q3 discussions emphasized strong subscription revenue growth, improving operating and free cash flow margins, and clear revenue guidance targets ( " " in Q1, " " in Q2, " " in Q3).

Q4 highlights record subscription revenue, further margin improvements that exceeded guidance, and robust net income figures ( " " ).

Consistent strength and an upward shift in profitability metrics, reflecting bullish sentiment on performance as margin expansion builds on earlier robust growth.

Consumption Transformation

Q1 launched the shift toward a consumption-based model ( " " ), Q2 detailed a near-complete rollout with pricing adjustments and accelerated customer acquisition ( " " ), and Q3 focused on landing high-quality customers to drive consumption ( " ).

Q4 emphasizes the successful transformation with high-velocity customer expansion, refined sales incentives (e.g., tracking DSP components) and a strong pipeline ( " " ).

Maturing from an early rollout to demonstrated operational success, this initiative is increasingly seen as driving durable, efficient growth.

Product Innovation and DSP Growth

Q1 introduced early-stage innovations like Flink and Table Flow ( " " ), Q2 underlined the expansion of platform capabilities and managed connectors ( " " ), and Q3 heralded a record level of product innovation with new offerings and acquisition of WarpStream ( " " ).

Q4 showcases a robust expansion with over 200 new features across DSP components, integrated product offerings (e.g., Tableflow GA) and strategic positioning of DSP as a major contributor to cloud revenue ( " " ).

Evolving from early experiments to a core revenue driver, product innovation is becoming even more integral to the company’s strategic positioning and future growth.

Strategic Partnerships Expansion

Not mentioned in Q1, Q2 or Q3 calls.

Q4 introduces major expanded partnerships with Databricks and Jio Platforms to integrate real‐time data solutions and support AI-driven applications ( " " " ).

A new and potentially transformative topic that expands market reach and strengthens the ecosystem, possibly having a large impact on future growth.

Customer Growth, Retention, and Digital Native Segments

Q1 reported the largest sequential customer growth and strong high-value account expansion ( " " ); Q2 noted solid multiproduct adoption with some digital native volatility ( " " ); Q3 highlighted stabilized digital native consumption and robust retention metrics ( " " ).

Q4 reports significant overall customer growth (840 new customers), a strong NRR of 117%, and continued traction among digital native companies ( " ).

Consistent robust growth with improving retention, while the digital native segment is recovering and increasingly adopting the platform, which further supports long‑term expansion.

Net Revenue Retention (NRR) Trends

Q1 showed NRR targets between 120% to 125% with higher multiproduct retention ( " ); Q2 noted NRR around 118% with some volatility ( " " ); Q3 reported a stable 117% NRR with minor declines ( " " ).

Q4 maintains an NRR of 117% combined with a gross retention rate above 90% ( " ).

Steady performance across periods, with slight short-term dips but overall stability and expectation for improvement as consumption and multiproduct adoption drive retention upward.

Generative AI Initiatives

Q1 introduced early Gen AI use cases through digital native projects ( " " ); Q2 provided detailed customer case studies exemplifying Gen AI impact ( " " ); Q3 hosted AI Day and launched an accelerator program, alongside deeper integration with OpenAI ( " ).

Q4 expands on Gen AI with multiple AI-related projects, enhanced strategic partnerships (notably with Databricks) for real‑time AI decision-making, and streamlining of AI use cases across industries ( " " ).

Growing prominence and sophistication of Gen AI initiatives, building momentum from early case studies to strategic partnerships that could significantly boost future growth.

Reduced Emphasis on Traditional Revenue Metrics

Q1 discussions already highlighted a shift away from RPO/CRPO in favor of consumption and subscription revenue measures ( " " ); no mention in Q2 and Q3.

Q4 continues this approach with the CFO noting that deferred revenue metrics aren’t the best indicators under the consumption model ( " ).

A consistent strategic repositioning away from traditional revenue metrics towards consumption-based indicators, reinforcing a modern approach to measuring growth and performance.

Early-Stage Strategic Initiatives

Q1 mentioned early-stage initiatives for System Integrators and Kafka Migration aimed at structured customer migration and channel expansion ( " " ); this topic was not mentioned in later quarters.

Q4 does not reference these initiatives.

The disappearance suggests a de‑emphasis or integration of these early-stage initiatives into broader strategies, potentially indicating maturation or deprioritization in public communications.