Summary
JFrog reported first quarter fiscal 2025 revenue of $122.4 million, up 22% from the prior-year quarter. Gross profit rose 15.7% to $92.2 million. The top line grew, but GAAP operating loss widened to $23.0 million, and net loss widened to $18.5 million. GAAP diluted loss per share was $0.16. Gross margin slipped to 75.3%, and operating margin was -18.8%. The quarter showed solid demand but weaker bottom-line leverage. Revenue growth outpaced gross profit growth, which means cost of revenue rose faster than sales. The company continued to invest in research and development, sales and marketing, and general and administrative functions, and those expenses pressured profitability. The operating loss widened even as revenue increased, so operating leverage remains a question. Management said the company maintained a prudent outlook given ongoing macroeconomic uncertainty.
Cloud revenue was $52.6 million, up 42% year-over-year, and represented 43% of total revenue, compared with 37% in the year-ago period. Operational metrics pointed to larger customers and deeper adoption. Customers with annual recurring revenue of $1 million or more reached 54, up from 40 a year earlier. Customers with ARR of $100,000 or more rose to 1,051 from 911. Net dollar retention for the trailing four quarters was 116%. Enterprise Plus subscriptions represented 55% of total revenue, compared with 49% in the year-ago period. The company released JFrog ML to all Enterprise cloud customers and announced a partnership with Hugging Face to help secure machine learning models. These moves extend the platform from DevOps and DevSecOps into MLOps. Management said cloud momentum was driven by increased usage and that full-platform adoption accelerated. The customer mix shift toward larger accounts can support revenue durability, though it may also require more sales and support investment. A majority of the Fortune 100 depends on JFrog solutions, according to the press release.
Cash generation and backlog were bright spots. Operating cash flow was $28.8 million, up 64.8% from the prior-year quarter. Capital expenditures were $0.65 million, down 23.1%. Deferred revenue was $275.5 million, up 30.4%. Remaining performance obligations were $424.2 million, up 62.1%. The backlog growth outpaced revenue growth, which suggests solid bookings. Free cash flow was $28.1 million, compared with $16.6 million in the prior-year quarter.
On a non-GAAP basis, operating income was $21.4 million and operating margin was 17.4%. Non-GAAP diluted earnings per share was $0.20. The gap between GAAP and non-GAAP results remains wide, mainly because of share-based compensation and amortization of acquired intangibles. GAAP operating loss of $23.0 million compares with non-GAAP operating income of $21.4 million, so the reconciling items are significant. Operating cash flow exceeded net loss because of non-cash charges. Guidance for the second quarter of 2025 includes non-GAAP operating income of $17.0 million to $18.0 million and non-GAAP diluted EPS of $0.15 to $0.17. For the full fiscal year 2025, management guided non-GAAP operating income to $74 million to $77 million and non-GAAP diluted EPS to $0.68 to $0.70. The company cited a prudent outlook given ongoing macroeconomic uncertainty.
Risks include a history of losses, the ability to retain and upgrade existing customers, competition, potential security breaches or product vulnerabilities, and integration of acquisitions such as Qwak AI. The company also noted the Middle East conflict and said it has a business continuity plan, with no major interruption or material adverse impact on operating results as of the filing date. Management's outlook implies continued growth, though the guidance ranges are non-GAAP and exclude share-based compensation and other items. The company expects to keep investing in the business, which could keep GAAP profitability under pressure. The Middle East conflict remains a risk because JFrog is domiciled in Israel, though operations span many countries with redundant infrastructure outside Israel. Some employees have been called into military service, but the company reported no major interruption as of the filing date.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2025 | Q4 FY2024 | QoQ | Q1 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $122.4M | $116.1M | +5.5% | $100.3M | +22.0% |
| Gross profit | $92.2M | $87.6M | +5.3% | $79.7M | +15.7% |
| Gross margin | 75.3% | 75.4% | -0.1 pp | 79.5% | -4.1 pp |
| Research & development | $43.3M | $44.9M | -3.5% | $35.8M | +20.9% |
| Sales & marketing | $52.8M | $50.0M | +5.7% | $43.6M | +21.2% |
| General & administrative | $19.0M | $18.1M | +5.3% | $16.9M | +12.4% |
| Total operating expenses | $115.2M | $113.0M | +2.0% | $96.3M | +19.6% |
| Operating income (loss) | -$23.0M | -$25.4M | +9.6% | -$16.6M | -38.1% |
| Operating margin | -18.8% | -21.9% | +3.1 pp | -16.6% | -2.2 pp |
| Net income (loss) | -$18.5M | -$23.2M | +20.2% | -$8.8M | -110.5% |
| Net margin | -15.1% | -20.0% | +4.9 pp | -8.8% | -6.4 pp |
| Diluted EPS | -$0.16 | -$0.21 | +$0.05 | -$0.08 | -$0.08 |
| Customers | 1,018 | 886 | +14.9% | 886 | +14.9% |
| Net retention rate | 116.0% | 116.0% | ±0.0 pp | 118.0% | -2.0 pp |
Risks
Gross margin decreased to 75.3% in FY2025 Q1 from 79.5% in FY2024 Q1, down 4.1 pp. MD&A attributes the decline to a continuous shift in revenue mix toward SaaS subscriptions, which incur higher hosting costs, and to intangible amortization, which could continue to pressure gross margin and operating results.
Operating loss widened to $22.97 million in FY2025 Q1 from $16.64 million in FY2024 Q1, and net loss widened to $18.50 million from $8.79 million. Diluted EPS was down to -$0.16 from -$0.08, with the loss widening, and the company has a history of annual losses.
The company is expanding into AI and MLOps, including through the Qwak acquisition, and risk factors note the EU AI Act entered into force on August 1, 2024, with fines up to €35 million or 7% of global income. Competitors may incorporate AI more quickly, and third-party AI model suppliers could terminate relationships or raise prices.
A material part of research and development and more than half of employees and consultants are located in Israel, and the filing details the war between Israel, Hamas and Hezbollah, regional conflict in the Middle East, and employee military service call-ups. MD&A states there has been no major interruption as of the report date but the situation remains volatile.
Net dollar retention rate was 116% as of March 31, 2025, compared to 118% as of March 31, 2024. If existing customers do not renew or expand their subscriptions, revenue growth could slow or decline.
The company competes with in-house solutions, DevOps vendors such as Microsoft GitHub and GitLab, and public cloud providers AWS, Microsoft Azure, and Google Cloud, which are also partners and may build or market competing products. Some competitors have greater financial, technical, and other resources.
Adverse macroeconomic conditions, including inflation, tariffs, and non-tariff trade barriers, could reduce enterprise IT spending and lead to longer sales cycles and enhanced budget scrutiny. The company has experienced longer sales cycles for certain products and expects these challenges to continue.
Competition for engineers in DevOps, DevSecOps, and MLOps is intense, especially in Israel and the San Francisco Bay Area, and the company expects difficulty hiring and retaining highly skilled employees. Headcount grew from approximately 1,400 as of December 31, 2023 to approximately 1,600 as of December 31, 2024.
The company acquired Qwak in July 2024 and may pursue more acquisitions. Integration may divert management attention, dilute shareholders, and adversely affect results; acquisition-related costs were $1.658 million in FY2025 Q1, up from $0.526 million in FY2024 Q1.
SaaS KPIs
All quarters →Free Cash Flow
Non-GAAP Operating Margin
Cloud Revenue
Non-GAAP Gross Margin
Customers with ARR > $100K
Customers with ARR > $1M
Cloud Revenue % of Total Revenue
Remaining Performance Obligations (RPO)
Enterprise+ Subscription % of Total Revenue
Summary, forecast, risks and KPIs are extracted from JFrog Ltd's SEC filings for Q1 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.