Summary
HubSpot's second quarter of fiscal 2025 showed steady top-line expansion but continued GAAP losses. Revenue was $760.9 million, up 19.4% from the prior-year quarter. Customers reached 267,982 at June 30, 2025, up 18% from June 30, 2024. Average subscription revenue per customer was $11,310, up 1% as reported. Calculated billings were $814.3 million, up 26% as reported and 20% in constant currency. Deferred revenue was $888.3 million, up 25.4% from the prior-year quarter. Remaining performance obligations were $1.30 billion, up 49.9%. Those metrics point to a business still adding customers and booking larger commitments.
Profitability remains the main tension. Gross profit was $638.7 million, up 17.9% from the prior-year quarter, while gross margin was 83.9%, down 1.1 percentage points from 85.0%. The operating loss was $24.6 million, compared with a loss of $23.9 million in the prior-year quarter, so the loss widened. GAAP operating margin was negative 3.2%, compared with negative 3.8% in the prior-year quarter, up 0.5 percentage points. Net loss was $3.3 million, so the loss narrowed from the prior-year quarter. Diluted EPS was negative $0.06, compared with negative $0.28 in the prior-year quarter, so the loss narrowed. On a non-GAAP basis, operating income was $129.1 million and non-GAAP net income was $117.3 million, or $2.19 per diluted share. The gap between GAAP and non-GAAP results remains wide, largely because of stock-based compensation and other excluded items.
Cash generation improved. Operating cash flow was $164.4 million in the quarter, up 39.5% from the prior-year quarter. Capital expenditures were $16.0 million, up 95.4% from the prior-year quarter. Non-GAAP free cash flow was $116.2 million, compared with $92.1 million in the prior-year quarter. Non-GAAP operating cash flow was $167.7 million, compared with $121.7 million in the prior-year quarter. Year to date, operating cash flow was $325.9 million, up 33.1%, and capital expenditures were $29.4 million, up 108.6%. Year-to-date revenue was $1.48 billion, up 17.6%, while year-to-date net loss was $25.1 million, so the loss widened from the prior-year period. Year-to-date diluted EPS was negative $0.48, so the loss widened from the prior-year period.
Guidance points to continued growth but a step down in the revenue growth rate. For the third quarter of 2025, HubSpot expects total revenue to grow 17% year over year as reported and 16% in constant currency. Non-GAAP operating income is expected to be $156.0 million to $157.0 million, a 20% operating profit margin. Non-GAAP net income per common share is expected to be $2.56 to $2.58. For the full year 2025, total revenue is expected to grow 17% year over year as reported and in constant currency. Non-GAAP operating income is expected to be $568.0 million to $572.0 million, an 18% operating profit margin. Non-GAAP net income per common share is expected to be $9.47 to $9.53. The company assumes approximately 53.0 million weighted average diluted shares for the third quarter and 53.4 million for the full year.
Risks remain familiar. HubSpot has a history of losses, and it must retain existing customers and add new ones to keep growing. Competition in the customer platform market is significant, and the company faces rapid technological change, including artificial intelligence and machine learning. Regulatory and legislative developments on AI and machine learning could affect the business. Macroeconomic conditions, geopolitical conflicts, inflation, foreign currency fluctuations, interest rates, recession risks, and tariffs or other trade restrictions are all listed as factors that could hurt results. The company also notes that foreign exchange and inflation have had, and may continue to have, an adverse impact on financial condition and operating results. Those risks matter because the quarter still produced a GAAP operating loss and a GAAP net loss, even as non-GAAP profitability and cash flow improved.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2025 | Q1 FY2025 | QoQ | Q2 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $760.9M | $714.1M | +6.5% | $637.2M | +19.4% |
| Gross profit | $638.7M | $599.0M | +6.6% | $541.7M | +17.9% |
| Gross margin | 83.9% | 83.9% | +0.1 pp | 85.0% | -1.1 pp |
| Research & development | $237.3M | $220.1M | +7.8% | $198.2M | +19.8% |
| Sales & marketing | $339.9M | $326.7M | +4.0% | $293.8M | +15.7% |
| General & administrative | $85.0M | $78.6M | +8.1% | $72.6M | +17.1% |
| Total operating expenses | $663.3M | $626.5M | +5.9% | $565.6M | +17.3% |
| Operating income (loss) | -$24.6M | -$27.5M | +10.4% | -$23.9M | -2.8% |
| Operating margin | -3.2% | -3.9% | +0.6 pp | -3.8% | +0.5 pp |
| Net income (loss) | -$3.3M | -$21.8M | +85.1% | -$14.4M | +77.4% |
| Net margin | -0.4% | -3.0% | +2.6 pp | -2.3% | +1.8 pp |
| Diluted EPS | -$0.06 | -$0.42 | +$0.36 | -$0.28 | +$0.22 |
| Customers | 267,982 | 258,258 | +3.8% | 228,054 | +17.5% |
Risks
Competitors may use evolving AI technologies to render HubSpot's products less competitive or obsolete, and the company must invest in AI features such as Breeze with uncertain market adoption and high computing costs. The risk factors state that AI development may require costly proprietary datasets and testing for accuracy and bias, and could impact profit margin if not monetized.
HubSpot's scalable pricing model, including freemium and recent seats-based and consumption-based changes, may not increase customer value as expected. MD&A reports Average Subscription Revenue per Customer decreased from $11,335 for the six months ended June 30, 2024 to $11,183 for the six months ended June 30, 2025, driven by continued purchases of lower-priced Starter products.
The risk factors disclose that HubSpot experienced a cybersecurity incident in 2024 and that attempts to exfiltrate customer data have occurred. A future breach could result in material disruption, regulatory fines, litigation, and reputational harm.
Global economic conditions, including inflation, tariffs, trade wars, interest rates, and foreign currency fluctuations, may reduce demand and increase costs. MD&A states that fluctuations in foreign exchange rates and rising inflation have had, and may continue to have, an adverse impact on financial condition and operating results.
The OBBBA was signed into law on July 4, 2025, and HubSpot is evaluating its impact on the estimated annual effective tax rate and cash tax position. Multinational tax developments such as Pillar Two global minimum tax could also increase tax liabilities.
HubSpot's headcount grew to 8,723 full-time employees as of June 30, 2025 from 8,246 as of December 31, 2024, increasing strain on management and culture. The hybrid remote model and competition for AI and software talent may make it harder to attract and retain key personnel, especially if the stock price declines.
HubSpot has acquired Frame AI, Dashworks, and Cacheflow, and may continue acquiring businesses. Integration risks include unanticipated costs, failure to realize expected benefits, diversion of management attention, and potential impairment of goodwill and intangible assets.
Select platform functionality depends on data from third parties such as Meta, Google, LinkedIn, and X. Changes to their data sharing policies or algorithms could impair HubSpot's ability to deliver useful data and harm platform value.
As of December 31, 2024, HubSpot had $640.0 million of U.S. federal and $723.7 million of state net operating loss carryforwards. State NOLs begin to expire in 2027, and an ownership change could limit the ability to utilize these carryforwards.
SaaS KPIs
All quarters →Average Subscription Revenue Per Customer
Non-GAAP Operating Margin
Non-GAAP Subscription Margin
Customers
Non-GAAP Free Cash Flow
Calculated Billings
Summary, forecast, risks and KPIs are extracted from HUBSPOT INC's SEC filings for Q2 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 1, 2026.