Executive Summary

Q4 delivered 14% y/y revenue growth to $107.1M and record non-GAAP operating margin of 10.7%, with non-GAAP operating income of $11.4M, as enterprise mix and premium modules drove leverage .
Leading indicators were strong: cRPO rose 26% y/y to $249.4M and total RPO rose 28% y/y to $351.5M, supported by large enterprise wins including the largest new-business ACV deal in company history .
FY25 outlook is measured given an unchanged demand environment vs. 2024 (Q1 revenue $107.2–$108.0M; FY25 revenue $448.1–$453.1M), with non-GAAP EPS of $0.65–$0.74; management prioritized investment flexibility while targeting continued operating leverage expansion on a full-year basis .
Near-term stock reaction catalysts: upside to company-issued Q4 guidance on operating income and EPS, enterprise momentum (>$50k segment +35% in FY24), and stabilizing retention dynamics, offset by cautious FY25 framing and decelerating ACV growth vs. mid-2024 .

What Went Well and What Went Wrong

What Went Well

Record profitability: non-GAAP operating margin reached 10.7% in Q4, “over 10% for the first time,” with non-GAAP operating income of $11.4M; non-GAAP free cash flow was $6.6M in Q4 and $29.7M for FY24 .
Enterprise traction: 26% y/y cRPO growth to $249.4M and large-enterprise momentum, including the largest new-business ACV win in company history and 35% FY24 revenue growth from the >$50k ARR segment .
Product/AI execution: accelerated AI Assist roadmap (11th enhancement), Analyze Chart by AI Assist, deeper Reddit integration, and sensitive data masking for compliance; strengthened Salesforce Service Cloud and Agentforce integrations; rebranded Influencer Marketing platform .

Quote: “AI is woven throughout the Sprout platform… designed to unlock customer efficiency.” — CEO Ryan Barretto .

What Went Wrong

Demand environment unchanged: management guided FY25 on a “more measured” basis, assuming no improvement in demand vs. 2024 and calling out elongated sales cycles and budget scrutiny .
Retention pressure: FY24 dollar-based NDR declined to 104% (from 107% in 2023), with NDR ex-SMB at 108% (from 111%); gross retention improved but expansion remained pressured in 2024 .
Growth mix deceleration: ACV growth +19% y/y in Q4 vs. +26% in Q3; revenue growth slowed to 14% y/y in Q4 vs. 20% in Q3 amid enterprise cycle lengths and cautious budgets .

Financial Results

Core quarterly metrics

Metric	Q2 2024	Q3 2024	Q4 2024
Revenue ($M)	$99.4	$102.6	$107.1
Non-GAAP EPS ($)	$0.09	$0.13	$0.19
Non-GAAP Operating Income ($M)	$5.3	$7.5	$11.4
Non-GAAP Operating Margin (%)	5.3%	7.3%	10.7%

Notes: Q4 2024 revenue +14% y/y ; Q3 2024 revenue +20% y/y .

Revenue composition

Metric	Q3 2024	Q4 2024
Subscription Revenue ($M)	$101.813	$105.922
Professional Services & Other ($M)	$0.825	$1.168
Total Revenue ($M)	$102.638	$107.090

KPIs and leading indicators

KPI	Q2 2024	Q3 2024	Q4 2024
RPO ($M)	$295.1	$311.5	$351.5
cRPO ($M)	$212.5	$220.7	$249.4
ACV ($)	13,403	13,959	14,651
Customers >$10k ARR (count)	8,966	9,119	9,327
Customers >$50k ARR (count)	1,545	1,610	1,718
Non-GAAP Free Cash Flow ($M)	$2.5	$9.3	$6.6

Retention (annual)

Metric	FY 2023	FY 2024
Dollar-based NDR	107%	104%
Dollar-based NDR ex-SMB	111%	108%

Guidance Changes

Metric	Period	Previous Guidance	Current/Actual	Change
Revenue ($M)	Q4 2024	$106.3–$107.1	$107.1	Beat
Non-GAAP Operating Income ($M)	Q4 2024	$8.7–$9.5	$11.4	Beat
Non-GAAP EPS ($)	Q4 2024	$0.15–$0.16	$0.19	Beat
Revenue ($M)	Q1 2025	n/a	$107.2–$108.0	New
Non-GAAP Operating Income ($M)	Q1 2025	n/a	$8.5–$9.5	New
Non-GAAP EPS ($)	Q1 2025	n/a	$0.14–$0.16	New
Revenue ($M)	FY 2025	n/a	$448.1–$453.1	New
Non-GAAP Operating Income ($M)	FY 2025	n/a	$38.2–$43.2	New
Non-GAAP EPS ($)	FY 2025	n/a	$0.65–$0.74	New

Management notes 2Q25 EPS may slightly decrease sequentially due to expense seasonality, then grow from Q2 to Q4 .

Earnings Call Themes & Trends

Topic	Q2 2024 (previous)	Q3 2024 (previous)	Q4 2024 (current)	Trend
AI/technology	Auto-classification, summaries, care AI; accelerating innovation pace	Continued AI in Care/Listening; enterprise scale features	11th AI Assist release; Analyze Chart by AI; sensitive data masking; deeper Reddit connection	Building
Partnerships (Salesforce/AWS/Meta)	Agentforce launch partner; deeper network partnerships	AWS Marketplace; Agentforce progress	First/only social integrated with Agentforce; Influencer Marketing integrates with Meta Partnership Ads API	Strengthening
Macro/demand	Elongated cycles; new approval steps	Macro consistent; elongated cycles	FY25 assumes demand same as 2024; measured guide	Unchanged/cautious
Enterprise momentum	Record pipeline; >$150k ACV up 64% y/y	>$50k customers +29% y/y; strong enterprise run-rate	>$50k segment revenue +35% in FY24; largest new-business ACV win; cRPO +26%	Improving
Retention	Improving gross retention	Gross retention improving	NDR 104% FY24; ex-SMB 108%; expected to improve as mix upmarket	Stabilizing/early recovery
Seasonality	—	Back-end weighted seasonality	2025 seasonality similar to 2024 (back-end weighted)	Stable
Influencer/Tagger	Fastest-growing product; strong cross-sell	Continued progress; early innings	Rebranded Sprout Social Influencer Marketing; broader AI roadmap	Expanding

Management Commentary

“Revenue [was] $107.1 million… cRPO… $249.4 million… 26% year-over-year growth… [with] steady improvements in gross retention, continued ACV growth, and momentum in our enterprise segment.” — CEO Ryan Barretto .
“Quarterly non-GAAP operating margin [reached] over 10% for the first time… [non-GAAP] operating income totaled $11.4 million… well ahead of the high end of our outlook.” — CFO Joe Del Preto .
“We are taking a more measured view on… 2025… assuming the demand environment… is unchanged from 2024.” — CFO Joe Del Preto .
Under Armour testimonial: “We chose Sprout for its innovative features, intuitive interface, and the ability to seamlessly manage publishing, listening, and social engagement all in one platform… [and] the integration with Salesforce Service Cloud…” .
“Sprout is the first and only social media solution integrated with Agentforce, enabling businesses to seamlessly connect social data with Service Cloud…” — CEO Ryan Barretto .

Q&A Highlights

Margin framework and investment flexibility: FY25 margin guidance set conservatively to preserve capacity to invest; leverage should expand if revenue overperforms, consistent with prior years .
Demand assumptions: Guidance assumes no improvement in 2025 demand vs. 2024 despite positive cRPO and logo momentum; visibility into execution improving with a full year of sales data .
Platform selling and NDR: Shift to structured platform selling aimed at higher ACVs and cross-sell (Care, Influencer), with move upmarket expected to lift NDR over time .
Seasonality and Q1 outlook: Back-end weighted seasonality similar to 2024; Q1 revenue guide implies modest q/q growth; Q2 EPS expected to dip slightly before rising through Q4 .
Partner ecosystem: Deeper Salesforce alignment (Agentforce for Service Cloud) and continued technical plus go-to-market integrations; competitive win rates benefiting from product strength and time-to-value .

Estimates Context

Wall Street consensus from S&P Global for Q4 2024 could not be retrieved at this time due to a daily request limit. As a result, we have not included consensus vs. actual comparisons for revenue or EPS. The company’s results exceeded its own Q4 guidance for non-GAAP operating income and EPS (see Guidance Changes) .

Key Takeaways for Investors

Enterprise-led mix shift is working: cRPO up 26% y/y and >$50k customer cohort accelerating; larger, longer-duration contracts support durable growth visibility .
Profitability inflection: Record non-GAAP operating margin (10.7%) with positive free cash flow momentum provides downside support and optionality to invest .
Product and AI cadence is a differentiator: Rapid AI Assist updates, compliance features, and deeper Reddit/Salesforce integrations strengthen competitive moat and win rates .
FY25 guide is conservative by design: Management assumes no macro improvement; upside exists if pipeline conversion and enterprise momentum persist, creating potential beat-and-raise setup .
Watch ACV and retention: ACV growth decelerated vs. mid-2024, but mix quality improved; NDR was pressured in 2024 yet expected to recover as upmarket strategy matures .
Influencer rebrand broadens TAM: Sprout Social Influencer Marketing + Meta Partnership Ads integration support multiproduct expansion and platform-selling motion in 2025 .
Near-term trading implications: Positive print vs. company guidance and improving enterprise KPIs could support shares, tempered by cautious FY25 framing and unchanged macro assumptions .

Additional Source Documents Reviewed

Q4 2024 press release (financials, KPIs, guidance) .
Q4 2024 earnings call transcript (prepared remarks and Q&A) .
Q3 2024 press release and call (trend analysis) .
Q2 2024 press release and call (trend analysis) .
Relevant product/market updates during Q4 window: AI/product innovations (Nov 20, 2024) , IDC MarketScape leadership (Dec 17, 2024) , Influencer platform rebrand (Feb 13, 2025) .

Sprout Social, Inc. (SPT)·Q4 2024 Earnings Summary