Subscription

Professional Services and Other

Total Revenue

6ad43dfe945729fd55af5f16f77c7fffdecd1c758f78dacad26f53b9a1ff1ca4

2066cb9cdb7637b36dee14ba4cbdd992a7dd47c2fcd5a7c2a05b389827e5d605

Adjustments for Non-Cash Items (USD, thousands)

Stock-Based Compensation (USD, thousands)

Changes in Working Capital (USD, thousands)

Capital Expenditures (CapEx) (USD, thousands)

Proceeds from / Repayments of Debt (USD, thousands)

Share Repurchases (USD, thousands)

Dividend Payments (USD, thousands)

Net Change in Cash (USD, thousands)

96441e83b2b7d5b0e688f95ab7c6d85ddebefd5a5e902fde26c0ab782c206eaf

27682f5ad0375a4c5cf23123ad8ecf94c03807b3de8074335c2741fb052587d4

Number of Customers (count)

Average Subscription Revenue per Customer (USD)

acd35b0f86471e7b7c5f2c2db538d55c9505414ce6bc9bedfaec9f37846d20de

Americas

- United States

Europe

- Ireland

Asia Pacific

- Australia

United States

Ireland

Australia

723bbc2f15b12ae385b5fd91c773614a5ec0206e3a89d6b3603b06f454f88dc8

Cash and cash equivalents (USD, thousands)

Short-term investments (USD, thousands)

Accounts receivable—net of allowance for credit losses (USD, thousands)

Deferred commission expense (USD, thousands)

Prepaid expenses and other current assets (USD, thousands)

Total current assets (USD, thousands)

Long-term investments (USD, thousands)

Property and equipment, net (USD, thousands)

Capitalized software development costs, net (USD, thousands)

Right-of-use assets (USD, thousands)

Deferred commission expense, net of current portion (USD, thousands)

Other assets (USD, thousands)

Intangible assets, net (USD, thousands)

Goodwill (USD, thousands)

Total assets (USD, thousands)

Accounts payable (USD, thousands)

Accrued compensation costs (USD, thousands)

Accrued commissions (USD, thousands)

Accrued expenses and other current liabilities (USD, thousands)

Operating lease liabilities (USD, thousands)

Convertible senior notes (USD, thousands)

Deferred revenue (USD, thousands)

Total current liabilities (USD, thousands)

Operating lease liabilities, net of current portion (USD, thousands)

Deferred revenue, net of current portion (USD, thousands)

Other long-term liabilities (USD, thousands)

Total liabilities (USD, thousands)

Common stock, $ 0.001 par value (USD, thousands)

Additional paid-in capital (USD, thousands)

Accumulated other comprehensive (loss) income (USD, thousands)

Accumulated deficit (USD, thousands)

Total stockholders’ equity (USD, thousands)

Total liabilities and stockholders’ equity (USD, thousands)

250f590cc57f421dc928687a0d7911c2d59d8636755c0086c89718e9a4343bb0

Net Income (Loss) [USD, thousands]

Depreciation and Amortization [USD, thousands]

Stock-Based Compensation [USD, thousands]

Gain on Strategic Investments [USD, thousands]

Impairment of Strategic Investments [USD, thousands]

Provision for (Benefit from) Deferred Income Taxes [USD, thousands]

Amortization of Debt Discount and Issuance Costs [USD, thousands]

Accretion of Bond Discount [USD, thousands]

Unrealized Currency Translation [USD, thousands]

Net Cash and Cash Equivalents Provided by Operating Activities [USD, thousands]

Purchases of Investments [USD, thousands]

Maturities of Investments [USD, thousands]

Purchases of Property and Equipment [USD, thousands]

Purchases of Strategic Investments [USD, thousands]

Capitalization of Software Development Costs [USD, thousands]

Acquisition of a Business, Net of Cash Acquired [USD, thousands]

Net Cash and Cash Equivalents Used in Investing Activities [USD, thousands]

Repayment of 2025 Convertible Notes Attributable to the Principal [USD, thousands]

Employee Taxes Paid Related to the Net Share Settlement of Stock-Based Awards [USD, thousands]

Proceeds Related to the Issuance of Common Stock Under Stock Plans [USD, thousands]

Net Cash and Cash Equivalents Provided by Financing Activities [USD, thousands]

Effect of Exchange Rate Changes on Cash and Cash Equivalents [USD, thousands]

Net Increase (Decrease) in Cash, Cash Equivalents and Restricted Cash [USD, thousands]

Cash, Cash Equivalents and Restricted Cash, Beginning of Year [USD, thousands]

Cash, Cash Equivalents and Restricted Cash, End of Year [USD, thousands]

3a22abce129ac292518866bab97ebecc20034157f85901aea288df9c4a5531ae

Operating Cash Flow was so high in Q1 2024 primarily because HubSpot experienced a **significant improvement in net income** (turning from a loss of **$36,565 thousand in Q1 2023** to a positive income of **$5,934 thousand in Q1 2024**), which substantially boosted the cash flow from operations. In addition, **higher stock-based compensation** (increasing from **$83,037 thousand** to **$111,122 thousand**) provided a major non-cash adjustment, and **increased depreciation and amortization** (from **$16,570 thousand** to **$21,234 thousand**) further supported the operating cash flow. Other factors, such as changes in deferred revenue and more favorable accounts receivable collections, also contributed to this improvement.  **[0000950170-24-057772_hubs-20240331.htm:33]** **[0000950170-24-055778_hubs-ex99_1.htm:5]** 

Why was Operating Cash Flow so high in Q1 2024?

The significantly higher operating cash flow in FY 2024 was primarily driven by **improved profitability**, as evidenced by a swing from a **net loss of $164,510 thousand in FY 2023 to a net income of $4,628 thousand in FY 2024**. In addition, **non-cash adjustments increased**, notably **stock-based compensation** rising from **$432,271 thousand to $504,770 thousand** and **depreciation and amortization** increasing from **$72,673 thousand to $96,828 thousand**. Moreover, **changes in working capital** such as larger increases in **deferred revenue** and **accrued expenses and other liabilities** also contributed to the boost in operating cash flow, even after accounting for offsetting factors like increases in **accounts receivable** and **deferred commission expense**.  **[0000950170-25-018873_hubs-20241231.htm:93]** **[0000950170-25-018873_hubs-20241231.htm:107]** 

What drove the significantly higher Operating Cash Flow in FY 2024?

The documents do not provide specific information regarding the reasons behind the lower figure of **793 [USD, thousands]** for Capital Expenditures Incurred but Not Yet Paid in Q3 2024.  **[0000950170-24-122373_hubs-20240930.htm:8]**  

Why were Capital Expenditures so low in Q3 2024?

8434903172ed8055a8b43dd2edc19fffd702c938ce789899395541c4b64701b2

Net income turned positive in Q1 2024 primarily because **HubSpot** experienced several favorable factors. The company saw **23% revenue growth** driven by strong subscription and professional services performance, which helped improve its GAAP operating margin from **(8.6%) to (3.8%)**. Additionally, a **non-recurring gain on strategic investments of $16,353 thousand** along with **higher interest income** and a significant **reduction in restructuring charges** collectively contributed to turning the net income positive in Q1 2024.  **[0000950170-24-055778_hubs-ex99_1.htm:0]** **[0000950170-24-057772_hubs-20240331.htm:6]** **[0000950170-24-055778_hubs-ex99_1.htm:5]** **[0000950170-24-057772_hubs-20240331.htm:8]** 

Why did net income turn positive in Q1 2024?

The drastic drop in **Restructuring Operating Expenses** in Q1 2024 was primarily due to the completion of major restructuring activities that took place in 2023. In **Q1 2023**, HubSpot incurred **$28,570 thousand** in restructuring costs associated with severance, employee-related benefits, and stock-based compensation, as well as facility-related expenses. By **Q1 2024**, most of these one-time costs had been incurred, leaving only **variable facilities-related costs** for unused space, which amounted to **$782 thousand**.  **[0000950170-24-057772_hubs-20240331.htm:22]** 

What drove the drastic drop in Restructuring Operating Expenses in Q1 2024?

HubSpot's Total Other Income (Expense) jumped significantly in Q1 2024 because of several key factors. The company experienced a **$1,217 thousand gain** from foreign currency fluctuations, which was partially offset by a **$3,615 thousand impairment** of strategic investments. However, the major contributor was a substantial **$16,353 thousand gain** on strategic investments, reflecting observable price changes that did not occur in Q1 2023. Collectively, these factors led to an overall **$13,955 thousand increase** in Total Other Income (Expense) in Q1 2024 compared to Q1 2023.  **[0000950170-24-057772_hubs-20240331.htm:30]** 

How did Total Other Income (Expense) jump so high in Q1 2024?

The Q4 2024 turnaround in **Income (Loss) Before Income Tax Expense** was primarily driven by **improved operating performance**—notably, a reduction in the GAAP operating loss from **($23.2 million)** in Q4 2023 to **($10.8 million)** in Q4 2024—as well as **strong revenue growth** with a **21%** increase in total revenue (including significant gains in both subscription revenue and professional services and other revenue).  **[0000950170-25-018839_hubs-ex99_1.htm:0]**  The improvement was further boosted by **increased other income** from gains on strategic investments and favorable currency transactions  **[0000950170-25-018873_hubs-20241231.htm:104]** , along with **substantially lower restructuring costs** (reducing from **$96.8 million** to **$3.99 million**) and a **41% increase in interest income** driven by improved yields and higher cash balances.  **[0000950170-25-018873_hubs-20241231.htm:90]** 

What contributed to the turnaround in income before tax in Q4 2024?

a90988e1dab3594be334f98d679ceefd7a491bd5e4071efceec28e0c012b503d

The spike in **cash and cash equivalents** in Q2 2024 was driven by several factors. Firstly, there was a significant increase in **net cash provided by operating activities**, with HubSpot generating **$244.9 million** in the first six months of 2024 compared to **$157.6 million** in the prior year. Secondly, a notable shift in **investing activities** turned from cash outflows of **($53.3 million)** to inflows of **$139.0 million**, reflecting changes in investment strategies. Additionally, **net cash provided by financing activities** increased, contributing further to the cash inflow. Finally, improved operating performance, as evidenced by a rise in **free cash flow** to **$92.1 million** in Q2 2024, and the effect of **foreign cash holdings** significantly bolstered the overall cash position.  **[0000950170-24-092843_hubs-20240630.htm:35]** **[0000950170-24-092811_hubs-ex99_1.htm:0]** 

Why did cash and cash equivalents spike in Q2 2024?

The significant increase in current liabilities in Q2 2024 was primarily driven by the inclusion of **Convertible Senior Notes** amounting to **$457,196 thousand** (which had no prior entry), along with an increase in **Deferred Revenue** (from **$672,150 thousand** to **$708,113 thousand**), higher **Accrued Compensation Costs** (from **$53,462 thousand** to **$61,206 thousand**), and a slight rise in **Accrued Expenses and Other Current Liabilities** (from **$94,074 thousand** to **$95,078 thousand**).  **[0000950170-24-092811_hubs-ex99_1.htm:3]** **[0000950170-24-092843_hubs-20240630.htm:5]** 

What drove the significant jump in current liabilities in Q2 2024?

The surge in Q3 2024 was driven by **higher cash flow generation**, **strong free cash flow**, and a strategic **focus on liquidity management**. Specifically, HubSpot generated **$159.5 million in operating cash flow** (up from **$89.0 million in Q3 2023**) and **$164.0 million in non-GAAP operating cash flow**, providing the capacity to invest more in short-term assets. Additionally, an improvement in non-GAAP free cash flow—from **$64.7 million** to **$129.2 million**—further enabled the increase in investments. The company’s deliberate strategy to maintain liquidity is evidenced by a balance of **$2.1 billion** in total cash, cash equivalents, and investments as of September 30, 2024.  **[0000950170-24-122373_hubs-20240930.htm:5]** **[0000950170-24-122326_hubs-ex99_1.htm:0]** **[0000950170-24-122326_hubs-ex99_1.htm:3]** 

What factors led to the surge in short-term investments in Q3 2024?

The sharp rise in **goodwill** in Q4 2024 was primarily driven by **acquisitions**. In Q4, the **goodwill** balance increased from **$173,761 thousand** to **$209,508 thousand**, with an acquisition-related amount of **$36,383 thousand** contributing to this increase.  **[0000950170-25-018873_hubs-20241231.htm:134]** 

HubSpot Inc (HUBS)

Financials