Group 1 - The core recommendation for N-able (NYSE: NABL) is to maintain a hold rating due to expected transitionary tailwinds impacting its valuation [1] - The ideal investment criteria include operating in a sector with structural growth exceeding GDP growth over the next 5-10 years, possessing sustainable competitive advantages, and being managed by competent and ethical long-term thinkers [1] - A fair valuation is also a critical component of the investment thesis for N-able [1]

Group 1 - N-able (NABL) has experienced a significant decline of 17.1% over the past four weeks, but it is now in oversold territory, indicating a potential trend reversal [1] - The Relative Strength Index (RSI) for NABL is currently at 21.21, suggesting that the heavy selling pressure may be exhausting itself [4] - There is strong consensus among Wall Street analysts that NABL will report better earnings than previously predicted, with a 5.7% increase in the consensus EPS estimate over the last 30 days [5] Group 2 - The upward trend in earnings estimate revisions typically leads to price appreciation in the near term, indicating a potential rebound for NABL [5] - NABL holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [5]

Financial Data and Key Metrics Changes - Total revenue for Q3 2024 was $116.4 million, reflecting an 8% year-over-year growth on a reported basis and 7% on a constant currency basis [8][37] - Adjusted EBITDA was $44.8 million, representing a 39% adjusted EBITDA margin, with a year-over-year increase of approximately 23% [41] - Subscription revenue reached $115 million, indicating a 9% year-over-year growth on a reported basis and 8% on a constant currency basis [37] - Gross margin for Q3 was 83.7%, down from 84.6% in the same period in 2023 [41] - Dollar-based net revenue retention was approximately 105%, or 104% on a constant currency basis [39] Business Line Data and Key Metrics Changes - Cove Data Protection emerged as the fastest-growing product solution and now represents the largest recurring revenue product group [11] - Demand for data protection solutions was highlighted as a significant growth driver, with businesses increasingly relying on protected data and functioning IT systems [10] - The security suite also saw steady demand, with offerings including EDR, endpoint antivirus, and managed detection and response services [12][13] Market Data and Key Metrics Changes - Approximately 47% of revenue was generated outside of North America during the quarter [42] - The managed service provider (MSP) market is projected to grow by at least 12% in 2024, indicating a favorable market environment for N-able [22] Company Strategy and Development Direction - The company is focused on empowering MSPs with leading security solutions as part of its fiscal year '24 transformative strategic pillars [16] - N-able aims to transform customer relationships by offering long-term contracts, with over 50% of monthly recurring revenue now under such contracts [17][18] - The company is investing in its Ecoverse initiative, which aims to create a next-generation open ecosystem IT management platform [25] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the health of the MSP channel, with a majority planning to grow in the coming year [52][53] - The company anticipates that headwinds from pricing and estate optimization will persist through the first half of 2025 [80] - Management noted that the shift towards cloud offerings is a positive trend, as more customers are moving away from on-premise solutions [72][75] Other Important Information - The company implemented strategic refinements to enhance its go-to-market strategy, maintaining adjusted EBITDA margins of over 30% [31] - N-able achieved SOC2 audit certification, ensuring compliance for service providers in regulated environments [29] Q&A Session Summary Question: What is the macro perspective on smaller MSPs? - Management reported that the majority of MSPs are planning to grow, with increased demand for security and disaster recovery solutions [52][53] Question: How sustainable is the cost rationalization in sales and marketing? - Management indicated that G&A spend is sustainable, while sales and marketing costs may fluctuate as new products are introduced [54][55] Question: Can you clarify the updated guidance regarding long-term contracts? - The guidance reflects a higher mix of customers opting for hosted and SaaS offerings, impacting revenue recognition [60] Question: What is the current mix between on-prem and SaaS? - On-premise revenue constitutes about 15% of the overall business, which is expected to trend downward as more customers shift to SaaS [66] Question: Are the pricing and estate optimization headwinds expected to continue into 2025? - Management expects these headwinds to persist through the first half of 2025, with a gradual improvement anticipated thereafter [80]

Revenue Performance - Total revenue for the three months ended September 30, 2024, was $116.4 million, an increase from $107.6 million in the same period of 2023, representing a growth of 8.2%[79] - Total revenue increased by $8.9 million, or 8.3%, for the three months ended September 30, 2024, compared to the same period in 2023[90] - Total revenue increased by $36.2 million, or 11.5%, for the nine months ended September 30, 2024, compared to the same period in 2023[103] Subscription Revenue - Subscription revenue rose by $9.8 million, or 9.3%, for the three months ended September 30, 2024, with subscription revenue accounting for 98.8% of total revenue[91] - Subscription revenue rose by $37.9 million, or 12.4%, for the nine months ended September 30, 2024, driven by growth in data protection and security solutions[103] - Subscription revenue accounted for 98.8% of total revenue for the three months ended September 30, 2024, up from 97.8% in 2023[92] Income and Profitability - Operating income for the three months ended September 30, 2024, was $23.9 million, compared to $18.4 million for the same period in 2023, reflecting a growth of 29.9%[80] - Net income for the three months ended September 30, 2024, was $10.8 million, up from $6.0 million in the same period of 2023, indicating an increase of 80%[80] - Income before income taxes increased by $19.8 million, or 71.9%, for the nine months ended September 30, 2024, compared to the same period in 2023[111] Expenses - Total cost of revenue increased by $2.5 million, or 14.7%, primarily due to increased public cloud infrastructure and hosting fees[94] - Research and development expenses increased by $3.2 million, or 16.4%, driven by higher personnel costs and stock-based compensation[96] - Total operating expenses increased by $11.5 million, or 5.4%, for the nine months ended September 30, 2024, compared to the same period in 2023[106] Cash Flow and Liquidity - Cash flows from operations for the three months ended September 30, 2024, were $22.0 million, down from $27.5 million in the same period of 2023[81] - Net cash provided by operating activities for the nine months ended September 30, 2024, was $53.5 million, down from $58.9 million in the same period of 2023[121] - Cash and cash equivalents totaled $174.4 million as of September 30, 2024, with international subsidiaries holding approximately $167.1 million[119] Retention and Customer Metrics - The number of MSP partners with annualized recurring revenue (ARR) over $50,000 increased by 6.6%, from 2,134 as of September 30, 2023, to 2,275 as of September 30, 2024[79] - Annual dollar-based net revenue retention rate for subscription products was approximately 105% for the trailing twelve-month period ended September 30, 2024, down from 108% in 2023[91] - The company had approximately 25,000 customers as of September 30, 2024[79] Tax and Interest - Income tax expense increased by $3.8 million, with an effective tax rate of 42.3% for the three months ended September 30, 2024[101] - Interest expense, net decreased by $0.3 million, or 3.4%, primarily due to lower interest rates and reduced outstanding borrowings[99] - Interest expense, net increased by $0.2 million, or 1.0%, primarily due to increased interest rates on borrowings under the Credit Agreement[109] Research and Development - Research and development expenses are expected to grow as the company continues to enhance security, monitoring, and authentication of its solutions[85] - Research and development expenses increased by $8.7 million, or 14.7%, primarily due to higher personnel costs and stock-based compensation[106] Operational Efficiency - Non-GAAP operating income for Q3 2024 was $37.5 million, compared to $30.5 million in Q3 2023, reflecting a 22.9% growth[115] - Non-GAAP operating margin for Q3 2024 was 32.2%, up from 28.4% in Q3 2023[115] - Operating expenses totaled $72.6 million, representing 62.4% of total revenue for the three months ended September 30, 2024, compared to 66.8% in 2023[95] Other Income and Expenses - Other income (expense), net increased by $2.7 million, or 636.4%, primarily due to changes in foreign currency exchange rates[100] - Other revenue decreased by $0.9 million, or 38.8%, primarily due to a decline in maintenance and professional services revenue[93] - Other income, net increased by $2.1 million, or 135.6%, primarily due to higher dividend income from money market fund financial assets[110] Financial Position - Total borrowings as of September 30, 2024, were $333.6 million, slightly down from $335.0 million as of December 31, 2023[119] - The company did not have any relationships with unconsolidated organizations or financial partnerships for off-balance sheet arrangements during the reporting period[119] - The company plans to utilize foreign earnings for investments in foreign operations or remit them to U.S. entities in a tax-efficient manner[119] Accounting Policies - The company’s financial statements are prepared in accordance with GAAP, requiring management to make estimates that affect reported amounts of assets, liabilities, revenue, costs, and expenses[128] - Critical accounting policies include the valuation of goodwill, intangibles, long-lived assets, revenue recognition, and income taxes[128] - There have been no material changes to critical accounting policies and estimates since the 2023 Annual Report[128]

Core Viewpoint - N-able (NABL) reported quarterly earnings of $0.13 per share, exceeding the Zacks Consensus Estimate of $0.10 per share, marking a 30% earnings surprise compared to the previous year's earnings of $0.09 per share [1] - The company also posted revenues of $116.44 million for the quarter ended September 2024, surpassing the Zacks Consensus Estimate by 1.44% and showing an increase from $107.57 million year-over-year [2] Financial Performance - N-able has consistently surpassed consensus EPS estimates over the last four quarters, achieving this four times [2] - The company’s shares have declined approximately 4% since the beginning of the year, contrasting with the S&P 500's gain of 24.3% [3] Future Outlook - The future performance of N-able's stock will largely depend on management's commentary during the earnings call and the trends in earnings estimate revisions [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.11 on revenues of $116.48 million, and for the current fiscal year, it is $0.46 on revenues of $464.42 million [7] Industry Context - The Technology Services industry, to which N-able belongs, is currently ranked in the top 28% of over 250 Zacks industries, indicating a favorable outlook compared to the bottom 50% [8] - The performance of N-able's stock may also be influenced by the overall industry outlook and trends in earnings estimate revisions [5][8]

Core Viewpoint - N-able (NABL) is experiencing significant selling pressure, having declined 10% over the past four weeks, but is now positioned for a potential trend reversal as it enters oversold territory with strong analyst support for better-than-expected earnings [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is utilized to identify oversold stocks, with a reading below 30 indicating oversold conditions [2]. - NABL's current RSI reading is 27.02, suggesting that the heavy selling may be exhausting itself and a trend reversal could be imminent [3]. Group 2: Earnings Estimates - There is a strong consensus among sell-side analysts that earnings estimates for NABL will improve, with a 4.2% increase in the consensus EPS estimate over the last 30 days [3]. - An upward trend in earnings estimate revisions typically correlates with price appreciation in the near term [3]. Group 3: Analyst Ratings - NABL holds a Zacks Rank 2 (Buy), placing it in the top 20% of over 4,000 ranked stocks based on earnings estimate revisions and EPS surprises [3].

N-able, Inc. (NYSE:NABL) Q2 2024 Earnings Call Transcript August 8, 2024 8:30 AM ET Company Participants Griffin Gyr - Investor Relations John Pagliuca - President and Chief Executive Officer Tim O'Brien - Executive Vice President & Chief Financial Officer Conference Call Participants Mike Richards - RBC Capital Markets Jason Ader - William Blair Charlotte Bedick - J.P. Morgan Mike Cikos - Needham Operator Welcome to the N-able Second Quarter 2024 Earnings Call. My name is Sam and I will be coordinating you ...

N-able (NABL) came out with quarterly earnings of $0.14 per share, beating the Zacks Consensus Estimate of $0.12 per share. This compares to earnings of $0.09 per share a year ago. These figures are adjusted for nonrecurring items. This quarterly report represents an earnings surprise of 16.67%. A quarter ago, it was expected that this provider of cloud-based software services would post earnings of $0.10 per share when it actually produced earnings of $0.11, delivering a surprise of 10%. Over the last four ...

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington D.C. 20549 FORM 10-Q (Mark One) ☑ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE AC OF 1934 For the quarterly period ended March 31, 2024 or ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File Number: 001-40297 N-able, Inc. (Exact name of registrant as specified in its charter) Delaware 85-4069861 (State or other jurisdiction of inc ...

Exhibit 99.1 N-able Announces First Quarter 2024 Results First-Quarter 2024 Revenue Increased 14% Year-Over-Year Raised Full-Year 2024 Constant Currency Revenue Outlook to 10% - 11% Year-Over-Year Growth Raised Full-Year 2024 Adjusted EBITDA Margin Outlook to 35% BURLINGTON, Massachusetts - May 9, 2024 - N-able, Inc. (NYSE:NABL), a global software company helping IT services providers deliver remote monitoring and management, data protection as-a-service, and security solutions, today reported results for i ...