Summary
Asana closed the third quarter of fiscal 2025 with revenue of $183.9 million, up 10% from $166.5 million a year earlier. Gross profit rose to $164.1 million from $150.5 million, but gross margin slipped to 89.2% from 90.4%. The company still posted a GAAP operating loss of $60.2 million, narrowed from $63.4 million in the prior-year quarter, and a GAAP net loss of $57.3 million, narrowed from $61.8 million. GAAP net loss per share was $0.25, compared with $0.28. Operating margin improved to negative 32.7% from negative 38.1%. On a non-GAAP basis, operating loss was $7.6 million, compared with $9.8 million, and net loss was $4.8 million, compared with $8.2 million. Non-GAAP net loss per share was $0.02, compared with $0.04.
Cash generation remained a pressure point. Operating cash flow was negative $14.9 million in the quarter, down from negative $8.2 million in the prior-year quarter. Free cash flow was negative $18.2 million, compared with negative $11.5 million. For the nine months ended October 31, 2024, operating cash flow was negative $0.9 million, up from negative $2.6 million in the prior-year period. Capital expenditures were $1.37 million in the quarter, up from $1.26 million a year earlier. Deferred revenue, current, stood at $279.6 million, up 12.0% year over year. Remaining performance obligations were $405.7 million, up 21.1%.
Operational metrics showed expansion with larger customers. Core customers, those spending $5,000 or more on an annualized basis, grew to 23,609, an increase of 11% year over year. Customers spending $100,000 or more on an annualized basis grew to 683, an increase of 18%. Overall dollar-based net retention rate was 96%. Core customer dollar-based net retention rate was 98%, and the rate for customers spending $100,000 or more was 99%. Asana launched AI Studio, a no-code builder for embedding AI agents into workflows. The company also appointed Sonalee Parekh as chief financial officer, committed to pursuing FedRAMP authorization, and launched a partnership with Mastercard that offers Business cardholders a 20% rebate on an annual subscription for first-time customers.
Guidance points to continued top-line growth with narrower losses. For the fourth quarter of fiscal 2025, Asana expects revenue of $187.5 million to $188.5 million, representing year-over-year growth of 10%. The company forecasts a non-GAAP operating loss of $6.5 million to $5.5 million, with a 3% operating loss margin. Non-GAAP net loss per share is expected to be $0.02 to $0.01, assuming basic and diluted weighted average shares outstanding of approximately 229 million. For fiscal 2025, Asana expects revenue of $723.0 million to $724.0 million, representing year-over-year growth of 11%. Non-GAAP operating loss is forecast at $46.0 million to $45.0 million, with a 6% operating loss margin. Non-GAAP net loss per share is expected to be $0.15 to $0.14, assuming approximately 229 million shares. Management says the company is on track to deliver positive free cash flow for Q4.
Risks remain tied to the macro environment and execution. Asana cites global macroeconomic events, inflation, elevated interest rates, bank failures, supply chain disruptions, currency fluctuations, and geopolitical unrest as factors that have hurt IT spending and lengthened sales cycles. The company also flags competition, the need to attract and retain customers, expand within existing accounts, integrate AI successfully, grow its self-service model, maintain strategic partner relationships, and manage international expansion. The quarter showed improving net retention for large customers and a narrower operating loss, but GAAP profitability is still distant. The guidance depends on steady subscription demand and cost discipline, while the AI Studio launch and FedRAMP effort are early bets that could support longer-term expansion.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q3 FY2025 | Q2 FY2025 | QoQ | Q3 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $183.9M | $179.2M | +2.6% | $166.5M | +10.4% |
| Gross profit | $164.1M | $159.2M | +3.1% | $150.4M | +9.1% |
| Gross margin | 89.2% | 88.8% | +0.4 pp | 90.4% | -1.1 pp |
| Research & development | $83.3M | $91.2M | -8.6% | $81.0M | +2.8% |
| Sales & marketing | $104.7M | $108.6M | -3.6% | $98.3M | +6.5% |
| General & administrative | $36.3M | $36.2M | +0.1% | $34.5M | +5.1% |
| Total operating expenses | $224.3M | $236.0M | -5.0% | $213.9M | +4.9% |
| Operating income (loss) | -$60.2M | -$76.8M | +21.6% | -$63.4M | +5.1% |
| Operating margin | -32.7% | -42.9% | +10.1 pp | -38.1% | +5.4 pp |
| Net income (loss) | -$57.3M | -$72.2M | +20.6% | -$61.8M | +7.2% |
| Net margin | -31.2% | -40.3% | +9.1 pp | -37.1% | +5.9 pp |
| Diluted EPS | -$0.25 | -$0.31 | +$0.06 | -$0.28 | +$0.03 |
| Customers | 580 | 553 | +4.9% | 21,346 | -97.3% |
| Net retention rate | 96.0% | 98.0% | -2.0 pp | 100.0% | -4.0 pp |
Risks
MD&A states that global macroeconomic events including inflation, elevated interest rates, bank failures, supply chain disruptions, currency fluctuations, and geopolitical unrest have led to economic uncertainty and are likely to continue to adversely affect global IT spending, customer buying patterns, and sales cycle length. Risk Factors also note the company has experienced and may continue to experience longer sales cycles, reduced renewal rates, reduced customer spend, and delayed payments.
Dollar-based net retention rate was 96% as of October 31, 2024 versus over 100% as of October 31, 2023. Core customer net retention was 98% versus over 105%, and customers spending over $100,000 annualized had 99% versus over 120%, indicating weaker expansion and higher contraction or attrition risk.
Risk Factors state competition requires rapid technological developments including successful deployment of AI in the product, and failure to offer or deploy new AI or machine learning technologies as quickly or effectively as competitors could adversely affect the business. MD&A also cites AI integration in the product and expects continued related research and development investment.
Gross margin decreased to 89.2% in FY2025 Q3 from 90.4% in FY2024 Q3 and to 89.2% year to date from 90.2% prior year to date. MD&A attributes the decrease primarily to increased third-party hosting costs and infrastructure and application performance monitoring costs.
The company is focused on increasing sales to larger organizations, which Risk Factors say requires sophisticated and costly sales efforts and may result in longer sales cycles, greater competition, less predictability, and more customization and support demands. MD&A describes continued strategic investments in sales and marketing and expects sales and marketing expenses to remain its largest operating expense in dollar amount.
Risk Factors state that sensitive information input into a third-party generative AI platform could be leaked or disclosed, including if used to train the third party's AI model, and that AI models ingesting personal information may reveal other personal or sensitive information. This creates legal, reputational, and customer trust exposure.
The business depends on senior management and key personnel, particularly co-founder, President, CEO, and Chair Dustin Moskovitz, and has no key person insurance on employees. Competition for executive, engineering, and sales personnel is intense, and past or future restructuring efforts may hurt retention.
For the nine months ended October 31, 2024, 40% of revenues were generated from customers outside the United States, exposing the company to conflicting privacy and data protection laws, data localization requirements, sanctions, tax rules, and other international regulatory risks.
SaaS KPIs
All quarters →Free cash flow
Non-GAAP operating margin
Customers Spending $100,000+ (annualized)
Total Customers
Summary, forecast, risks and KPIs are extracted from Asana, Inc.'s SEC filings for Q3 FY2025 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.