Summary
Semrush closed fiscal 2021 with strong top-line growth but a wider fourth-quarter loss. Fourth-quarter revenue rose 47.5% year over year to $53.7 million. Full-year revenue rose 50.6% to $188.0 million. Gross profit rose 51.2% to $42.18 million in the quarter and 53.8% to $146.07 million for the full year. Gross margin was 78.5% in the fourth quarter, up 1.9 percentage points year over year, and 77.7% for the full year, up 1.7 points. The margin gains show the SaaS model scales, but spending is rising faster than revenue in the short term.
Fourth-quarter operating loss widened to $3.65 million, and operating margin fell to -6.8%, down 2.3 percentage points year over year. Net loss widened to $3.86 million. The full-year picture was better. Full-year operating loss narrowed to $2.49 million, and operating margin improved to -1.3%, up 3.6 percentage points. Full-year net loss narrowed to $3.28 million. Diluted EPS for the full year was -$0.03, an improvement from the prior year. The quarterly loss reflects heavy investment in sales, marketing, and product development, while the annual loss narrowed because revenue growth outpaced cost growth over the full year.
Operational metrics stayed healthy. ARR was $213 million as of December 31, 2021, up 48% year over year. Dollar-based net revenue retention was 126%, up from 124% in the previous quarter. Semrush had more than 82,000 paying customers at year end, up approximately 22% from a year earlier. Customers paying more than $10,000 annually grew more than 75% year over year in the fourth quarter. Prowly had more than 1,000 customers and grew ARR more than 100% year over year in the fourth quarter. Deferred revenue, current portion, was $40.23 million, up 51.6% year over year. Operating cash flow was $5.01 million in the fourth quarter, up 22.9%, and $23.76 million for the full year, up 306.0%. Capital expenditures were $0.82 million in the quarter, up 80.3%, and $2.38 million for the full year, up 0.5%. Non-GAAP net loss was $2.9 million in the fourth quarter and $0.5 million for the full year.
Guidance points to continued growth but ongoing non-GAAP losses. For the first quarter of 2022, revenue is expected to be $55.8 million to $56.2 million, up 40% year over year, and non-GAAP net loss is expected to be $4.7 million to $4.5 million. For the full year 2022, revenue is expected to be $245 million to $247 million, up over 30% year over year, and non-GAAP net loss is expected to be $22 million to $21.5 million. Semrush says it cannot reconcile the non-GAAP net loss guidance to GAAP without unreasonable efforts because of the variability of share-based compensation, employer taxes, and tax deductions tied to equity awards. The guidance implies the company will keep spending to capture a large market opportunity.
Business highlights include a new keyword intent filter and an App Center that now has fifteen apps, including ten third-party offerings. The company also points to growing demand from larger accounts and expansion of its platform. Risks remain significant. Semrush faces intense competition, must keep innovating, and needs to hire and retain qualified personnel. It expects to incur losses and negative cash flows for the foreseeable future, and it plans to increase sales and marketing, research and development, and general and administrative expenses. Foreign currency fluctuations can also affect results. The company has a senior secured credit facility that matures in January 2024. The fourth quarter shows the growth engine is working, but the rising operating loss and planned 2022 non-GAAP loss show that profitability is not the near-term priority.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2021 | Q3 FY2021 | QoQ | Q4 FY2020 | YoY |
|---|---|---|---|---|---|
| Revenue | $53.7M | $49.3M | +9.1% | — | — |
| Gross profit | $42.2M | $37.9M | +11.3% | — | — |
| Gross margin | 78.5% | 76.9% | +1.6 pp | — | — |
| Research & development | $6.8M | $6.2M | +10.5% | — | — |
| Sales & marketing | $25.7M | $20.7M | +24.3% | — | — |
| General & administrative | $13.3M | $11.4M | +17.1% | — | — |
| Total operating expenses | $45.8M | $38.2M | +19.9% | — | — |
| Operating income (loss) | -$3.7M | -$330.0K | -1007.3% | — | — |
| Operating margin | -6.8% | -0.7% | -6.1 pp | — | — |
| Net income (loss) | -$3.9M | -$615.0K | -528.0% | — | — |
| Net margin | -7.2% | -1.3% | -5.9 pp | — | — |
| Diluted EPS | -$0.03 | $0.00 | -$0.03 | — | — |
Risks
More than half of full-time employees are located in Russia and the company has significant development operations in Eastern Europe, exposing it to military conflict in Ukraine, sanctions, SWIFT exclusion, and Russian government threats to seize assets or arrest leaders. These conditions could disrupt delivery, force relocation, and materially harm operations.
Substantially all revenue and cash flows come from paying customers with premium subscriptions, and customers predominantly choose monthly subscription terms that allow them to terminate or adjust subscriptions monthly. Failure to renew or upgrade premium subscriptions would directly harm revenue and operating results.
The online visibility market is fragmented with low barriers to entry, and competitors include point solutions that may have greater resources, lower-priced or free products, or bundling strategies. Competitive pressure could force price cuts, discounts, or higher sales and marketing spending.
The platform relies on publicly available and paid third-party data, including social media APIs from Facebook, Twitter, Instagram, Pinterest, and LinkedIn, and negotiated data provider agreements. Loss of access, less favorable terms, or provider shutdowns could increase costs and impair platform functionality.
A large portion of paying customers are SMBs and marketing agencies, and most paying customers are on month-to-month premium subscriptions that can be cancelled at any time. An economic downturn or reduced discretionary spending could lower demand, retention, and revenue.
Changes by search engines, social networking sites, and other third-party services to algorithms, technology configurations, or anti-spam policies could reduce the efficacy of backlink analytics, link building, and Prowly email tools. The company may need to reduce prices, discontinue products, or incur costly product changes.
The company depends on CEO and co-founder Oleg Shchegolev, COO and co-founder Dmitry Melnikov, and Chief Product Officer Vitalii Obishchenko, and faces intense competition for software engineers and sales professionals in Boston, St. Petersburg, Warsaw, and other office locations. Loss of key personnel could disrupt strategy and product development.
Paying customers grew to over 82,000 as of December 31, 2021 from over 67,000 as of December 31, 2020, with seven global offices and a dispersed workforce. Failure to integrate, train, and manage this growth could strain operations, customer service, and product development.
The company has experienced attempts to exploit system vulnerabilities, including a brute force attack that resulted in access to affiliate program partner contact information. A future breach or data security incident could damage customer relationships, trigger notification and liability obligations, and harm reputation.
Growth depends on unpaid content marketing and paid advertising to attract visitors and convert them into paying customers, and MD&A states sales and marketing expenses are expected to increase in absolute dollars and as a percentage of revenue in 2022 versus 2021. If marketing efforts become less effective, customer acquisition costs could rise without a corresponding increase in paying customers.
SaaS KPIs
All quarters →ARR per Paying Customer
Paying Customers
ARR
Dollar Based Net Revenue Retention
Summary, forecast, risks and KPIs are extracted from SEMrush Holdings, Inc.'s SEC filings for Q4 FY2021 (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.