Summary
HubSpot closed fiscal 2024 with fourth-quarter revenue of $703.18 million, up 20.8% from the prior-year quarter. Full-year revenue reached $2.63 billion, up 21.1%. Gross profit was $599.84 million in the quarter, up 21.3%, and $2.23 billion for the year, up 22.0%. Gross margin improved to 85.3% in the quarter, up 0.3 percentage points, and to 85.0% for the year, up 0.6 percentage points. The company still posted an operating loss of $10.80 million in the quarter, though the loss narrowed from the prior-year quarter. The full-year operating loss was $67.60 million, also narrower than the prior-year period. Net income was $4.98 million in the quarter, a swing to profit from the prior-year quarter. For the full year, net income was $4.63 million, a swing to profit from the prior-year period. Diluted EPS for the full year was $0.09, a swing to profit from the prior-year period.
Operating cash flow rose 86.1% to $194.14 million in the quarter and 70.6% to $598.60 million for the year. Capital expenditures were $12.73 million in the quarter, up 46.5%, and $37.94 million for the year, up 12.5%. Deferred revenue increased 16.7% to $784.25 million. Remaining performance obligations rose 23.9% to $1.00 billion. Those figures show a business that is generating more cash while building a larger backlog of contracted work. The gap between operating cash flow and capital expenditures is wide, which gives the company room to fund investments and potential acquisitions.
Customer count reached 247,939 as of December 31, 2024, up from 205,091 a year earlier. Average Subscription Revenue per Customer slipped to $11,343 for 2024 from $11,384 in 2023. Net revenue retention declined from the prior year. Management said customer growth came from demand for lower-priced Starter products and a new seats pricing model. The lower average subscription revenue per customer reflected the same mix shift, plus foreign currency translation. HubSpot ended the year with 8,246 full-time employees and customers in more than 135 countries. The company sells to mid-market B2B companies, which it defines as businesses with between two and 2,000 employees. It reaches them through a freemium model, Solutions Partners, and an inbound sales motion.
Management's forward-looking commentary in the 10-K says the company may break even from a profitability perspective in the next 12 months. It also expects professional services and other margins to break even in the next 12 months, exclusive of stock-based compensation. The company plans to keep investing in sales and marketing, research and development, customer service, and data center infrastructure. Those investments could keep pressure on near-term profitability even as revenue scales. Over time, management expects sales and marketing expenses to decline as a percentage of total revenue, while research and development and general and administrative expenses remain relatively consistent as a percentage of total revenue, in each case exclusive of stock-based compensation.
The filing flags several risks. Macroeconomic conditions, foreign currency fluctuations, inflation, recession risks, and geopolitical conflicts could hurt results. HubSpot also faces significant competition, rapid technological change, and the need to expand its customer base and increase adoption within existing customers. The company depends on its freemium model, Solutions Partners, and inbound methodology to reach mid-market B2B companies. Any slowdown in those channels could weigh on growth. Most customer subscriptions are one year or less in duration, so the company must continually renew and expand accounts to sustain growth. Because subscriptions are billed in advance on various schedules, changes in deferred revenue may not accurately indicate future revenue. Management's plan to invest for long-term growth means expenses will likely rise in absolute dollars, even if some costs decline as a percentage of revenue over time.
Forecast
No forward guidance in this quarter's filings.
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2024 | Q3 FY2024 | QoQ | Q4 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $703.2M | $669.7M | +5.0% | $581.9M | +20.8% |
| Gross profit | $599.8M | $570.4M | +5.2% | $493.3M | +21.6% |
| Gross margin | 85.3% | 85.2% | +0.1 pp | 84.8% | +0.5 pp |
| Research & development | $213.7M | $191.2M | +11.8% | $163.2M | +30.9% |
| Sales & marketing | $314.8M | $309.9M | +1.6% | $281.1M | +12.0% |
| General & administrative | $81.0M | $77.9M | +3.9% | $69.7M | +16.1% |
| Total operating expenses | $610.6M | $580.0M | +5.3% | $517.6M | +18.0% |
| Operating income (loss) | -$10.8M | -$9.6M | -12.1% | -$24.3M | +55.6% |
| Operating margin | -1.5% | -1.4% | -0.1 pp | -4.2% | +2.6 pp |
| Net income (loss) | $5.0M | $8.1M | -38.8% | -$13.6M | +136.6% |
| Net margin | 0.7% | 1.2% | -0.5 pp | -2.3% | +3.0 pp |
| Diluted EPS | $0.10 | $0.16 | -$0.06 | -$0.27 | +$0.37 |
| Customers | 247,939 | 238,128 | +4.1% | 205,091 | +20.9% |
Risks
The filing expands AI-related risks, stating competitors may use evolving AI technologies to make products less competitive or obsolete. HubSpot's Breeze and generative AI initiatives may require significant investment, increase compute costs, and create accuracy, bias, copyright, reputational, or regulatory exposure.
Net Revenue Retention was 102.2% for 2024, compared with 103.9% for 2023 and 110.3% for 2022. Average Subscription Revenue per Customer decreased from $11,384 for 2023 to $11,343 for 2024, and customers may renew for lower tiers, fewer seats, or shorter contract lengths.
The Risk Factors disclose that a cybersecurity incident affected the company in 2024 and that cyber-attacks and attempts to exfiltrate customer data have occurred in the past. A compromise or perceived compromise could lead to liability, remediation costs, regulatory fines, and reputational harm.
HubSpot's growth strategy relies on scalable pricing, freemium versions, and a recent seats-based pricing model. MD&A attributes customer growth to lower-priced Starter products and the new seats model, which contributed to the decrease in Average Subscription Revenue per Customer; failure to upsell or expand customers could harm revenue.
The 2025 Notes are convertible at holder option during the quarter ending March 31, 2025, and between December 31, 2024 and the filing date HubSpot settled $89.3 million of principal in cash. The remaining notes are due June 1, 2025, and cash settlement or refinancing could strain liquidity.
HubSpot acquired Cacheflow in October 2024 and Frame AI in January 2025, following Clearbit in December 2023. The filing highlights integration, management distraction, dilution, unforeseen liabilities, and failure to realize expected returns from acquisitions.
MD&A states results may be significantly influenced by macroeconomic conditions including inflation, foreign currency fluctuations, interest rates, and recession risks. Weak conditions could reduce customer spending, delay purchasing decisions, and pressure renewals or pricing.
SaaS KPIs
All quarters →Average Subscription Revenue Per Customer
Customers
Summary, forecast, risks and KPIs are extracted from HUBSPOT INC's SEC filings for Q4 FY2024 (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.