Summary
Tenable closed fiscal 2022 with fourth-quarter revenue of $184.6 million, up 23.9% from the prior-year quarter. Full-year revenue reached $683.2 million, up 26.3%. Gross profit rose 17.9% to $139.4 million in the quarter and 21.5% to $528.4 million for the full year. The top line grew faster than gross profit, and gross margin fell 3.8 percentage points to 75.5% in the quarter and 3.0 percentage points to 77.3% for the full year. Management tied much of the cost of revenue increase to third-party cloud infrastructure costs, personnel costs, and amortization of acquired intangible assets.
Profitability stayed under pressure. Fourth-quarter operating loss widened 9.5% to $14.1 million, and full-year operating loss widened 62.4% to $67.8 million. Net loss widened 94.5% to $21.5 million in the quarter and 97.6% to $92.2 million for the full year. Full-year diluted loss per share was $0.83, and the loss widened 88.6% from the prior year. Operating margin improved 1.0 percentage point to negative 7.6% in the quarter, but full-year operating margin fell 2.2 percentage points to negative 9.9%. On a non-GAAP basis, fourth-quarter income from operations was $19.9 million, full-year non-GAAP income from operations was $67.7 million, fourth-quarter non-GAAP net income was $14.2 million, full-year non-GAAP net income was $44.3 million, and non-GAAP diluted earnings per share were $0.12 for the quarter and $0.38 for the full year.
Cash generation was a bright spot. Operating cash flow rose 45.3% to $31.9 million in the fourth quarter and 35.5% to $131.2 million for the full year. Unlevered free cash flow was $32.1 million in the quarter and $128.1 million for the full year. Calculated current billings rose 23% to $238.9 million in the quarter and 26% to $776.9 million for the full year. Current deferred revenue rose 23.2% to $502.1 million, and remaining performance obligations rose 21.7% to $680.4 million. That growing deferred revenue base supports future revenue recognition, but the company still expects to keep incurring operating losses in the near term.
Customer metrics show steady expansion. Tenable added 571 new enterprise platform customers and 140 net new six-figure customers in the fourth quarter. For the full year, new enterprise platform customers were 2,078, up from 1,882 in 2021, and customers with $100,000 and greater in annual contract value were 1,420 at December 31, 2022, up from 1,095 at December 31, 2021. The dollar-based net expansion rate was 117% at December 31, 2022, unchanged from 117% at December 31, 2021 and inside the expected 110% to 120% range. Recurring revenue represented 95% of revenue in 2022. The October 2022 launch of Tenable One sits at the center of the exposure management strategy.
Guidance for the first quarter of 2023 calls for non-GAAP income from operations of $9.0 million to $10.0 million, non-GAAP net income of $3.0 million to $4.0 million, and non-GAAP diluted earnings per share of $0.02 to $0.03. For the full year 2023, the outlook calls for calculated current billings of $915.0 million to $925.0 million, non-GAAP income from operations of $86.0 million to $91.0 million, non-GAAP net income of $63.0 million to $68.0 million, non-GAAP diluted earnings per share of $0.52 to $0.56, and unlevered free cash flow of $175.0 million to $180.0 million. Risks include a competitive and rapidly changing environment, continued operating losses, gross margin pressure from cloud infrastructure costs, and foreign exchange fluctuations. The company also carries debt and faces covenant and interest rate exposure.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2022 | Q3 FY2022 | QoQ | Q4 FY2021 | YoY |
|---|---|---|---|---|---|
| Revenue | $184.6M | $174.9M | +5.6% | $149.0M | +23.9% |
| Gross profit | $139.4M | $136.3M | +2.3% | $118.2M | +17.9% |
| Gross margin | 75.5% | 77.9% | -2.4 pp | 79.3% | -3.8 pp |
| Research & development | $36.9M | $36.1M | +2.2% | $30.7M | +20.2% |
| Sales & marketing | $91.3M | $88.1M | +3.6% | $77.5M | +17.8% |
| General & administrative | $25.3M | $25.0M | +1.1% | $22.8M | +10.6% |
| Total operating expenses | $153.5M | $149.2M | +2.9% | $131.0M | +17.1% |
| Operating income (loss) | -$14.1M | -$13.0M | -8.7% | -$12.9M | -9.5% |
| Operating margin | -7.6% | -7.4% | -0.2 pp | -8.6% | +1.0 pp |
| Net income (loss) | -$21.5M | -$18.7M | -14.7% | -$11.0M | -94.5% |
| Net margin | -11.6% | -10.7% | -0.9 pp | -7.4% | -4.2 pp |
| Diluted EPS | -$0.19 | -$0.17 | -$0.02 | -$0.10 | -$0.09 |
| Customers | 43,000 | 392,112 | -89.0% | 40,000 | +7.5% |
Risks
Macroeconomic uncertainty, including inflation and recession concerns, may cause customers to reduce or delay technology spending, lengthen sales cycles, and negatively impact renewal rates. The filing states that unfavorable macroeconomic conditions could result in longer average sales cycles and that retention may decline if customers reduce spending.
Intense competition from larger vendors such as Microsoft, CrowdStrike, and Palo Alto Networks that can bundle competing products and exert pricing pressure. The filing notes that some competitors have significantly greater resources and may offer products at lower prices, which could cause average sales prices for our offerings to decline.
A substantial portion of revenue is generated through third-party channel partners, with Ingram Micro accounting for 38% of revenue in 2022. The agreement with Ingram Micro can be terminated on 30 days' written notice, and channel partners have no obligation to renew, posing a risk to revenue if they shift focus to competitors.
As a cybersecurity provider, the company faces heightened risk of being targeted by cyberattacks, including nation-state actors and ransomware. A compromise of its solutions could simultaneously affect many customers and result in significant liability and reputational harm.
Gross margin declined to 77.3% for FY2022 YTD from 80.3% for FY2021 YTD, driven by a 45% increase in cost of revenue primarily from third-party cloud infrastructure costs. Continued investment in cloud infrastructure and customer support could further pressure margins.
Long and unpredictable sales cycle, particularly with large enterprises, may cause revenue fluctuations. The filing notes that macroeconomic conditions and additional customer controls on expenditures could lengthen the average sales cycle, which is approximately four months for enterprise customers.
Stringent and evolving data privacy and security laws, such as GDPR and CCPA, impose significant compliance costs and potential penalties. The filing notes increased scrutiny of cross-border data transfers and potential fines of up to 4% of annual global revenue under GDPR.
Interest expense increased 153% to $19.0 million in FY2022 from $7.5 million in FY2021 due to the variable rate Term Loan. Rising interest rates could further increase debt service costs and impact net loss.
Summary, forecast, risks and KPIs are extracted from Tenable Holdings, Inc.'s SEC filings for Q4 FY2022 (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 6, 2026.