Financial Performance - Total revenue for Q2 2025 was $71.0 million, a 17% increase from $60.6 million in Q2 2024[3] - Non-GAAP operating profit was $2.4 million, representing 3% of revenue, down from 9% in Q2 2024[3] - Non-GAAP net income was $1.1 million, or 2% of revenue, compared to 7% in Q2 2024[5] - FY 2025 total revenue guidance is estimated between $285.0 million and $288.0 million, representing approximately 15% growth year-over-year[9] - Q3 2025 total revenue guidance is estimated between $71.5 million and $72.0 million[9] - Total revenue for the six months ended June 30, 2025, increased to $138,053, up from $119,619 in the same period of 2024, representing a growth of approximately 15.5%[24] - Gross profit for the six months ended June 30, 2025, was $109,815, compared to $94,379 for the same period in 2024, reflecting an increase of about 16.4%[24] - Non-GAAP gross profit for the six months ended June 30, 2025, was $111,172, compared to $97,018 for the same period in 2024, reflecting an increase of approximately 14.6%[31] Customer Metrics - Customer base grew by 18% to 5,951 as of June 30, 2025[5] - Customers with annual recurring revenue (ARR) of $100,000 or more increased by 13% to 433, contributing 63% of total ARR[5] - Dollar-based net retention rate (NRR) for customers with ARR of $100,000 or more was 108% in Q2 2025, down from 109% in Q2 2024[5] Expenses and Losses - Operating expenses for the six months ended June 30, 2025, rose to $125,990, up from $98,016 in 2024, indicating a significant increase of approximately 28.5%[24] - Net loss for the six months ended June 30, 2025, was $21,108, compared to a net loss of $3,471 in the same period of 2024, marking an increase in losses of about 508%[24] - The company reported a significant increase in research and development expenses, which rose to $36,328 for the six months ended June 30, 2025, compared to $25,778 in 2024, an increase of about 40.8%[24] Cash and Assets - Cash and cash equivalents at the end of the period on June 30, 2025, were $59,341, a decrease from $63,869 at the beginning of the period[29] - Total current assets increased to $141,356 as of December 31, 2024, compared to $131,649 as of June 30, 2025, showing a growth of approximately 7.3%[22] - Total liabilities decreased to $215,403 as of December 31, 2024, from $221,821 as of June 30, 2025, indicating a reduction of about 2.9%[22] Research and Development - The company expects to continue its focus on research and development, with GAAP R&D expenses projected to increase to $36,328 for the six months ended June 30, 2025[33]

Group 1 - The analyst downgraded Similarweb (NYSE: SMWB) to a hold rating in November due to concerns that the valuation had become too rich despite positive views on the fundamentals [1] - The investment approach focuses on identifying undervalued companies with long-term growth potential, blending value investing principles with a long-term growth focus [1] - The strategy emphasizes buying quality companies at a discount to their intrinsic value and holding them for the long term to allow for compounding of earnings and shareholder returns [1]

Financial Data and Key Metrics Changes - Revenue increased by 14% to $67 million compared to the previous year [6][14] - Customer base grew by 19% year over year to over 5,700 ARR customers [6] - Non-GAAP operating loss was reported at 2% due to increased investments in sales and R&D [15][16] - Generated $5 million of normalized free cash flow, marking the sixth consecutive quarter of positive free cash flow [16] Business Line Data and Key Metrics Changes - The growth in revenue was driven by a 19% increase in customers, particularly in the below $100,000 ARR cohort [14] - NRR for customers over $100,000 increased by 400 basis points year over year to 111% [14] - 52% of ARR is now contracted under multiyear contracts, up from 42% last year [15] Market Data and Key Metrics Changes - Remaining performance obligations (RPO) totaled $253 million at the end of Q1, an 18% increase year over year [15] - The company continues to monitor global macroeconomic developments, with no material impact from tariffs observed so far [17] Company Strategy and Development Direction - The company is focused on becoming an AI-first organization, with new product launches indicating positive returns on investments made in sales and R&D [10][13] - The launch of App Intelligence allows the company to provide data on over 4 million mobile apps, enhancing its digital visibility offerings [9] - The company aims to drive enterprise motion and expand its offerings to existing customers, leveraging its diverse product portfolio [73] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in achieving profit and cash flow targets, citing improved operating margins over the past three years [16] - For the full year 2025, the company maintains its revenue guidance of $285 million to $288 million, representing a 15% year-over-year growth at the midpoint [17] - Management is optimistic about the commercial pipeline for new AI products and the overall demand for digital data [11][12] Other Important Information - The company completed an accelerated recruitment of new salespeople, with expectations for improved productivity by Q3 [8] - The integration of AI chatbot traffic data into the platform has generated strong customer interest and engagement [22][24] Q&A Session Summary Question: Quality of new hires and productivity ramp - Management is pleased with the quality of new hires and has established metrics to track their productivity [20][21] Question: Customer interest in AI chatbot data - Customers have shown excitement about the new AI chatbot data, which provides unique insights into traffic generated by chatbots [22][24] Question: Visibility on revenue growth in the second half - Management indicated that the ramp-up of new sales hires varies by role, with inside sales showing quicker productivity [28] Question: Impact of SearchMonitor acquisition - The acquisition is not expected to materially impact revenue but is seen as a strategic addition to enhance product offerings [30] Question: Trends among larger clients - Management noted a slight decline in NRR due to tougher comps from previous upsells but remains optimistic about ongoing demand [35][36] Question: Changes in guidance philosophy - Management confirmed that there have been no significant changes to guidance philosophy despite market uncertainties [32][33] Question: Expansion activity and customer growth - Management reported healthy pipeline activity and noted that expansion with existing customers remains strong [87][89] Question: AI product sales strategy - The company is targeting a broader audience for AI products, with excitement across various customer roles [47] Question: Timeline for new sales hires to show results - New sales hires are expected to ramp up productivity by Q3, with management prepared to adjust if necessary [66][68]

Financial Data and Key Metrics Changes - Revenue increased by 14% to $67 million, exceeding expectations [5][13] - Customer base grew by 19% year-over-year to over 5,700 ARR customers [5] - Non-GAAP operating loss was 2% due to increased investments in sales and R&D [14] - Generated $5 million of normalized free cash flow, marking the sixth consecutive quarter of positive free cash flow [15] Business Line Data and Key Metrics Changes - The growth in revenue was driven by a 19% increase in customers, particularly in the below $100,000 ARR cohort [13] - NRR for over $100,000 customers increased by 400 basis points year-over-year to 111% [13] - 52% of ARR is contracted under multiyear contracts, up from 42% last year, indicating improved customer retention [14] Market Data and Key Metrics Changes - Remaining performance obligations (RPO) totaled $253 million at the end of Q1, up 18% year-over-year [14] - The company continues to monitor global macroeconomic developments, with no material impact from tariffs observed so far [16] Company Strategy and Development Direction - The company is focused on becoming an AI-first organization, with new product launches aimed at maximizing ROI for customers [12][10] - Investments in sales and R&D are expected to yield higher margins and faster growth moving forward [12] - The launch of App Intelligence and AI Chatbots traffic intelligence is part of the strategy to provide comprehensive digital visibility [7][8] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the ability to achieve profit and cash flow targets, despite current investments [15] - The company maintains its revenue guidance for 2025, expecting total revenue in the range of $285 million to $288 million, representing 15% year-over-year growth [16] - Management is optimistic about the commercial pipeline for new AI products and the overall customer reaction to recent launches [10][12] Other Important Information - The company has completed an accelerated recruitment of new salespeople, with over 80% expected to be fully ramped by Q3 [6] - The integration of AI chatbot traffic data into the platform has generated strong customer interest and engagement [22][24] Q&A Session Summary Question: Inquiry about the quality of new hires and productivity ramp - Management expressed satisfaction with the quality of new hires and outlined metrics for measuring productivity [20][21] Question: Early indications of customer interest in AI chatbot traffic data - Customers have shown excitement and engagement with the new AI chatbot traffic data, indicating a strong demand for insights [22][24] Question: Visibility on deals supporting revenue reacceleration - Management discussed the diverse roles within the sales team and the varying sales cycles for different customer segments [29][30] Question: Impact of SearchMonitor acquisition on guidance - The acquisition is not expected to materially impact guidance, as it is a small business [31] Question: Trends in larger clients and NRR - A slight decline in NRR was attributed to last year's significant upsell activity, with ongoing engagement from large clients [36][38] Question: Changes in guidance philosophy - Management confirmed that there have been no significant changes to guidance philosophy despite market uncertainties [33] Question: Execution priorities for the year - The focus is on driving enterprise motion and expanding existing customer relationships [73] Question: Engagement and pipeline for AI chatbot traffic product - The product is currently in beta, with positive customer engagement and plans for monetization in the near future [83]

The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Similarweb shares have lost about 43.2% since the beginning of the year versus the S&P 500's decline of -0.6%. What's Next for Similarweb? While Similarweb has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? Similarweb (SMWB) came out with a ...

Financial Performance - Q1 2025 revenue reached $67.1 million, representing a 14% year-over-year growth[8] - Q1 2025 non-GAAP gross margin was 80%[8] - The company's Remaining Performance Obligations (RPO) totaled $252.7 million, with 69% expected to be recognized over the next 12 months[8] - Q1 2025 Revenue Annualized (Q1 2025 Revenue * 4) is $268 million[8] - The company's dollar-based net retention rate (NRR) for $100K+ ARR customers was 111% in Q1 2025[8] - Non-GAAP operating loss was $(1.3) million in Q1 2025, representing a -2% operating margin[68] - Non-GAAP Normalized Free Cash Flow was $4.9 million in Q1 2025, a 7% margin[68] Customer Base - The company has over 5,700 customers[26] - 61% of total ARR comes from customers with $100K+ ARR[8] - 52% of ARR is from multi-year subscriptions[8] Market Opportunity - The company estimates its addressable market to be $55 billion[32]

[Similarweb Q1 2025 Earnings Release](index=1&type=section&id=Similarweb%20Q1%202025%20Earnings%20Release) [Financial & Business Highlights](index=1&type=section&id=Financial%20%26%20Business%20Highlights) The company reported accelerated revenue growth and expanded its customer base, achieving its sixth consecutive quarter of positive free cash flow - Revenue growth accelerated to **14% in Q1 2025**, up from 12% in Q1 2024[1](index=1&type=chunk) - The company launched several new products during the quarter, including App Intelligence, AI Chatbot data, and three new AI Agents to enhance its market intelligence offerings[3](index=3&type=chunk) [Q1 2025 Financial Highlights](index=1&type=section&id=Q1%202025%20Financial%20Highlights) Q1 2025 Key Financial Metrics (vs. Q1 2024) | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Revenue** | $67.1M | $59.0M | +14% YoY | | **GAAP Operating Loss** | $(9.3)M | $(2.7)M | Increased Loss | | **GAAP Operating Margin** | (14)% | (5)% | Decreased | | **GAAP Net Loss per Share** | $(0.11) | $(0.03) | Increased Loss | | **Non-GAAP Operating (Loss)/Profit** | $(1.3)M | $2.8M | Profit to Loss | | **Non-GAAP Operating Margin** | (2)% | 5% | Decreased | | **Non-GAAP Net Loss/Profit per Share** | $(0.02) | $0.04 (basic) | Profit to Loss | [Q1 2025 Business & Operational Highlights](index=2&type=section&id=Q1%202025%20Business%20%26%20Operational%20Highlights) Key Business Metrics as of March 31, 2025 | Metric | Q1 2025 | Q1 2024 | Change | | :--- | :--- | :--- | :--- | | **Total Customers** | 5,767 | 4,846 (approx) | +19% YoY | | **Customers with ARR > $100k** | 411 | 377 (approx) | +9% YoY | | **Overall NRR** | 101% | 98% | +3 p.p. | | **NRR for Customers > $100k ARR** | 111% | 107% | +4 p.p. | | **Remaining Performance Obligations (RPO)** | $252.7M | $213.6M | +18% YoY | | **Multi-year Subscriptions (% of ARR)** | 52% | 42% | +10 p.p. | Cash Flow Performance (Q1 2025 vs Q1 2024) | Metric | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net Cash from Operating Activities** | $4.9M | $10.1M | | **Free Cash Flow** | $4.4M | $9.7M | | **Normalized Free Cash Flow** | $4.9M | $9.7M | [Financial Outlook](index=3&type=section&id=Financial%20Outlook) The company provided positive full-year guidance, projecting 15% revenue growth and a return to Non-GAAP operating profitability for FY 2025 Full Year 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | **Total Revenue** | $285.0M - $288.0M | | **YoY Growth (Midpoint)** | ~15% | | **Non-GAAP Operating Profit** | $1.0M - $4.0M | Second Quarter 2025 Guidance | Metric | Guidance Range | | :--- | :--- | | **Total Revenue** | $68.6M - $69.0M | | **Non-GAAP Operating Loss** | $(1.0)M - $(0.5)M | [Consolidated Financial Statements](index=8&type=section&id=Consolidated%20Financial%20Statements) The statements show a slight decrease in total assets, an increased GAAP net loss driven by higher expenses, and positive net cash from operations [Consolidated Balance Sheets](index=8&type=section&id=Consolidated%20Balance%20Sheets) Key Balance Sheet Items (in thousands) | Account | March 31, 2025 | December 31, 2024 | | :--- | :--- | :--- | | **Cash and cash equivalents** | $59,567 | $63,869 | | **Total current assets** | $126,918 | $141,356 | | **Total assets** | $237,687 | $242,911 | | **Deferred revenue (current)** | $109,170 | $108,232 | | **Total liabilities** | $213,705 | $215,403 | | **Total shareholders' equity** | $23,982 | $27,508 | [Consolidated Statements of Comprehensive Income (Loss)](index=10&type=section&id=Consolidated%20Statements%20of%20Comprehensive%20Income%20(Loss)) Q1 Income Statement Summary (in thousands) | Account | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Revenue** | $67,087 | $58,982 | | **Gross Profit** | $53,117 | $46,286 | | **Total Operating Expenses** | $62,408 | $48,970 | | **Loss from Operations** | $(9,291) | $(2,684) | | **Net Loss** | $(9,259) | $(2,733) | | **Net Loss Per Share (basic & diluted)** | $(0.11) | $(0.03) | - Total share-based compensation costs increased to **$5.8 million** in Q1 2025 from $4.1 million in Q1 2024, contributing to the higher operating loss[25](index=25&type=chunk) [Consolidated Statements of Cash Flows](index=12&type=section&id=Consolidated%20Statements%20of%20Cash%20Flows) Q1 Cash Flow Summary (in thousands) | Activity | Q1 2025 | Q1 2024 | | :--- | :--- | :--- | | **Net cash provided by operating activities** | $4,886 | $10,064 | | **Net cash used in investing activities** | $(9,910) | $(4,341) | | **Net cash provided by financing activities** | $562 | $(22,329) | | **Net decrease in cash** | $(4,302) | $(16,842) | | **Cash at end of period** | $59,567 | $54,890 | - Cash used in investing activities increased significantly in Q1 2025 to **$9.9 million**, primarily due to a $9.3 million payment for business combinations[27](index=27&type=chunk) [Reconciliation of GAAP to Non-GAAP Financial Measures](index=15&type=section&id=Reconciliation%20of%20GAAP%20to%20Non-GAAP%20Financial%20Measures) The report reconciles GAAP to non-GAAP results by adjusting for items like share-based compensation and business combination-related costs Reconciliation of GAAP Operating Loss to Non-GAAP Operating Loss (Q1 2025, in thousands) | Line Item | Amount | | :--- | :--- | | **Loss from operations (GAAP)** | **$(9,291)** | | Share-based compensation | $5,809 | | Retention payments (business combinations) | $1,559 | | Amortization of intangibles (business combinations) | $660 | | **Non-GAAP operating loss** | **$(1,263)** | Reconciliation to Free Cash Flow and Normalized Free Cash Flow (Q1 2025, in thousands) | Line Item | Amount | | :--- | :--- | | **Net cash provided by operating activities (GAAP)** | **$4,886** | | Purchases of property and equipment, net | $(501) | | **Free cash flow** | **$4,385** | | Deferred payments (business combinations) | $485 | | **Normalized free cash flow** | **$4,870** |

Core Insights - The article discusses potential investment opportunities in SMWB, indicating a possible long position in the stock within the next 72 hours [1]. Group 1 - The analyst has no current stock or derivative positions in the companies mentioned but may initiate a beneficial long position soon [1]. - The article expresses the author's personal opinions and is not influenced by any compensation from the companies discussed [1]. Group 2 - The article does not provide specific performance guarantees or investment recommendations, emphasizing that past performance does not ensure future results [2]. - It clarifies that the views expressed may not represent the overall stance of Seeking Alpha, and the analysts involved may not be licensed or certified [2].

Taxation and Regulatory Risks - The company may be classified as a passive foreign investment company (PFIC) if 75% or more of its gross income is passive income, which could lead to adverse U.S. federal income tax consequences for U.S. holders of its ordinary shares [228]. - The company does not believe it was classified as a PFIC for the taxable year ended December 31, 2024, but this determination must be made annually and could change based on income and asset composition [228]. - Changes in tax laws or regulations could increase the costs of the company's solutions and harm its business, potentially requiring the company or its customers to pay additional taxes or fines [231]. - The company may face substantial tax liabilities if required to collect sales or other related taxes in jurisdictions where it has not historically done so [235]. - The company's financial statements may not reflect adequate reserves for potential tax liabilities arising from challenges by taxing authorities [237]. - The application of U.S. federal, state, local, and non-U.S. tax laws to services provided electronically is unclear and evolving, which could adversely affect the company's results of operations [232]. - The enactment of legislation implementing changes in taxation of international business activities could impact the company's future financial position and results of operations [238]. Shareholder and Market Dynamics - As of December 31, 2024, there were 82,618,511 ordinary shares outstanding, with 44.6% beneficially owned by insiders [245]. - The company had 6,408,897 shares available for future grants under its 2021 Plan, increasing to 10,539,823 shares as of January 1, 2025 [250]. - The company does not anticipate paying any dividends in the foreseeable future, intending to retain future earnings to finance operations and expand its business [258]. - The concentration of share ownership with insiders may limit the ability of other shareholders to influence corporate matters [245]. - Future sales of ordinary shares in the public market could cause the market price to decline, impacting the company's ability to raise capital [246]. - The company may lose its "foreign private issuer" status, resulting in significant additional costs and expenses related to compliance with U.S. reporting requirements [256]. Geopolitical and Operational Risks - The ongoing military conflicts in Israel may adversely affect the company's operations and limit its ability to market products, potentially leading to decreased revenues [263]. - The war declared against Hamas has contributed to a deterioration of Israel's economic standing, including credit rating downgrades by agencies such as Moody's and S&P Global [266]. - Several hundred thousand Israeli military reservists were drafted, potentially disrupting operations and adversely affecting business results [267]. - Absences of employees from Israeli suppliers due to military service may impact the ability to deliver products and services [268]. - Ongoing hostilities and cyberattacks could lead to increased costs and risks to employee safety, potentially resulting in financial losses [269]. - The global perception of Israel may lead to increased sanctions and a boycott of Israeli goods, affecting business operations [270]. - Proposed changes to Israel's judicial system could negatively impact the business environment and lead to political instability [271]. - The company has a significant operational presence in Israel, which is affected by geopolitical tensions, potentially disrupting operations and impacting financial performance [287]. - Approximately 50 employees are engaged in Ukraine, primarily in software development, and ongoing military conflict may disrupt development efforts and increase costs [288]. - The company faces risks from sanctions against Russia, which could adversely affect operations and revenue generation in affected regions [290]. Financial Performance and Conditions - The company's share price may be volatile, influenced by factors such as market conditions, operating performance, and changes in financial estimates by analysts [241]. - A hypothetical 10% change in foreign currency exchange rates could impact the company's net loss by $10.0 million and $9.8 million for the years ended December 31, 2023, and 2024, respectively [492]. - As of December 31, 2023, the company had cash and cash equivalents of $81.8 million, which are subject to interest rate risk but are not expected to materially impact financial statements [493]. - The company had no outstanding borrowings under the SVB LSA as of December 31, 2024, and a hypothetical 10% change in interest rates would not have materially impacted financial statements [494]. - The company does not believe inflation has materially affected historical results, but significant inflationary pressures could adversely impact financial condition and operations [495]. Corporate Governance and Compliance - The company is classified as an "emerging growth company," allowing it to delay adopting new accounting standards until they apply to private companies [251]. - The company qualifies as an "emerging growth company" and has elected to use an extended transition period for complying with new accounting standards, which may affect comparability with other public companies [496]. - The company is incorporated under Israeli law, which may differ from U.S. corporate governance practices, affecting shareholder rights [274]. - Provisions of Israeli law may delay or prevent acquisitions, impacting shareholder value and control changes [275]. Strategic Growth and Acquisitions - The company acquired two companies in 2024 and two more in Q1 2025 to enhance its platform and optimize products [282]. - Future acquisitions may divert management attention and pose integration challenges, potentially harming financial performance [283]. - The company may face litigation risks that could adversely affect its reputation and financial condition [285].

Financial Performance - Q4 2024 revenue reached $65.6 million, representing a 16% year-over-year growth[8] - The company's Q4 2024 annualized revenue is $262 million (Q4 2024 Revenue * 4)[8] - Q4 2024 non-GAAP gross margin was 78%[8] - The company achieved a non-GAAP operating profit of $2.6 million in Q4 2024[64] - The company's non-GAAP normalized free cash flow was $2.7 million in Q4 2024[64] - For the full year 2024, revenue reached $250 million, a 15% increase compared to the $218 million in FY 2023[42] Customer Base and Retention - The company had 5,534 total ARR customers in Q4 2024, a 17% increase year-over-year[45] - Dollar-based net retention rate (NRR) for $100K+ ARR customers was 112% in Q4 2024[8] - 61% of total ARR comes from customers with $100K+ ARR[8] Business Model - Remaining Performance Obligation (RPO) is $246.0 million, with 69% expected to be recognized over the next 12 months[8] - 49% of ARR is from multi-year subscriptions[8]