Core Insights - Sprout Social reported strong financial results for Q1 2025, with a revenue growth of 13% year-over-year, reaching $109.3 million [6][2] - The company emphasized its focus on enterprise growth, customer adoption, and leveraging partnerships to drive expansion [2] Financial Performance - Revenue for Q1 2025 was $109.3 million, a 13% increase compared to Q1 2024 [6] - Current remaining performance obligations (cRPO) stood at $255.8 million, up 21% year-over-year [6] - GAAP operating loss improved to ($11.2) million from ($13.3) million in Q1 2024 [6] - Non-GAAP operating income was $12.5 million, compared to $6.0 million in Q1 2024 [6] - GAAP net loss was ($11.2) million, an improvement from ($13.6) million in Q1 2024 [6] - Non-GAAP net income reached $12.5 million, up from $5.7 million in Q1 2024 [6] - Cash and equivalents totaled $101.9 million as of March 31, 2025, compared to $90.2 million at the end of 2024 [6] Customer Metrics - The number of customers contributing over $10,000 in annual recurring revenue (ARR) increased by 6% to 9,381 [7] - The number of customers contributing over $50,000 in ARR grew by 22% to 1,766 [7] - Notable customers acquired during the quarter included Palo Alto, NASCAR, and Avis Budget Car Rental [8] Business Outlook - For Q2 2025, the company expects total revenue between $110.4 million and $111.2 million [15] - Full-year 2025 revenue is projected to be between $448.9 million and $453.9 million [15]

Markets are breathing a huge sigh of relief as we enter into the thick of the Q1 earnings season. Across all sectors, the major theme appears to be "not as bad as feared." Many companies are revising theirWith combined experience of covering technology companies on Wall Street and working in Silicon Valley, and serving as an outside adviser to several seed-round startups, Gary Alexander has exposure to many of the themes shaping the industry today. He has been a regular contributor on Seeking Alpha since 20 ...

Core Insights - Social media has transformed from a niche marketing tool to a central element of culture, commerce, and connection, becoming essential for brands to engage with customers and drive growth [1][2] - Sprout Social has achieved a 32% compound annual growth rate since going public in 2019, serving around 30,000 customers across more than 100 countries [2][6] Company Developments - Sprout Social has expanded its platform with over 200 new product capabilities in 2024, focusing on AI-driven customer care, employee advocacy, analytics, and influencer marketing solutions [3][6] - The company has a global workforce of over 1,000 employees and has established offices in Chicago, Seattle, Dublin, and Krakow [2][6] Industry Trends - The current social media landscape is characterized by rapid advancements in AI, rising consumer expectations, and the growing influence of social media influencers [3] - Brands must adapt to the evolving social media environment, emphasizing real-time engagement and customer loyalty [2][3] Recognition and Future Outlook - Sprout Social was awarded the 1 Best Software Product by G2's 2024 Best Software Award, highlighting its commitment to customer-led innovation [3][7] - The company is actively engaging with customers and industry leaders to discuss future trends in social media, including the impact of influencers and AI [4]

Core Viewpoint - Sprout Social (SPT) is experiencing significant selling pressure, with a 20.9% decline over the past four weeks, but is now positioned for a potential trend reversal as it enters oversold territory, supported by analyst expectations of better-than-previously predicted earnings [1]. Group 1: Technical Indicators - The Relative Strength Index (RSI) is utilized to determine if a stock is oversold, with a reading below 30 typically indicating this condition [2]. - SPT's current RSI reading is 29.21, suggesting that the heavy selling pressure may be exhausting itself, indicating a potential trend reversal [5]. Group 2: Fundamental Analysis - There is strong consensus among sell-side analysts that earnings estimates for SPT have increased by 2.1% over the last 30 days, which often correlates with price appreciation [7]. - SPT 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, further indicating a potential turnaround [8].

Core Insights - Sprout Social has launched a reimagined influencer marketing platform featuring AI-driven capabilities for natural language discovery and data analysis, aimed at enhancing brand partnerships and revenue generation [1][2][3] Company Developments - The new platform includes a refreshed design and is tailored to meet the evolving needs of marketers who are shifting towards more authentic and relatable connections with consumers [1][2] - Strategic updates were made based on customer feedback to address challenges in creating cohesive, data-driven campaigns and finding suitable influencers [3][6] Industry Trends - Traditional marketing tactics are becoming less effective, prompting marketers to seek innovative ways to engage consumers through social media [2] - Influencer marketing has transitioned from a trend to a critical driver of return on investment (ROI), with nearly half of consumers making purchases influenced by social media posts [2] Platform Features - AI-Powered Natural Language Creator Search allows marketers to identify creators based on topics, facilitating faster and more impactful partnerships [6][7] - The AI-Powered Brand Fit Score provides an instant assessment of how well a creator's content aligns with a brand's values, aiding in smarter decision-making [7] - Customizable Brand Safety Reporting helps brands ensure that creators align with their safety guidelines by analyzing content against defined parameters [7][8]

Core Viewpoint - Sprout Social, Inc. will report its financial results for Q1 2025 on May 8, 2025, after market close [1] Financial Results Announcement - The financial results and business highlights will be discussed in a conference call and webcast scheduled for 4:00 p.m. Central Time on May 8, 2025 [2] - Online registration for the conference call is available at the provided link [2] - A live webcast of the conference call can be accessed from Sprout Social's investor relations website [2] Webcast Replay - A replay of the webcast will be available for 12 months following the event [3] Company Overview - Sprout Social is a global leader in social media management and analytics software, serving approximately 30,000 brands [4] - The company offers a comprehensive platform that includes publishing, engagement functionality, customer care, influencer marketing, advocacy, and AI-powered business intelligence [4] - Sprout Social's software operates across all major social media networks and digital platforms [4] Information Availability - Sprout Social routinely announces material information through SEC filings, press releases, public conference calls, webcasts, and its investor website [5] - The company encourages stakeholders to review the information shared on its investor website and social media profiles [5] Social Media Profiles - Sprout Social maintains various social media profiles for communication with investors and the public [6]

Group 1 - The article discusses Sprout Social (NASDAQ: SPT) and previously held a hold rating due to insufficient evidence of success in penetrating the enterprise customer base [1] - The author emphasizes a diverse investing background, incorporating fundamental, technical, and momentum investing strategies to refine the investment process [1] - The purpose of writing on Seeking Alpha is to track investment ideas and connect with like-minded investors [1] Group 2 - There is no stock, option, or similar derivative position in any of the companies mentioned, nor plans to initiate any such positions within the next 72 hours [2] - The article expresses the author's own opinions and is not receiving compensation for it, aside from Seeking Alpha [2] - Seeking Alpha clarifies that past performance is not indicative of future results and does not provide specific investment recommendations [3]

Revenue Growth and Market Position - Sprout Social generated revenue of $405.9 million in 2024, representing a growth of 22% from 2023 and 31% from 2022[40]. - The platform serves approximately 30,000 customers across more than 100 countries, with over 99% of revenue in 2024 coming from software subscriptions[33][36]. - The annual served addressable market (SAM) for the platform in 2023 exceeded $55 billion, with an estimated growth to over $120 billion by 2025, representing an annual market growth rate of greater than 25%[80]. - More than 80% of revenue in 2024 was generated from new customers through unpaid channels, highlighting strong market leadership[62]. - The company has approximately 30,000 current customers, with a focus on Mid-market and Enterprise segments, expecting growth driven by these areas[86]. - The company received the 1 spot on G2 across all software products in 2024, reflecting its commitment to delivering superior value[95]. Customer Engagement and Satisfaction - Nearly three-quarters of consumers expect a response to social media messages within 24 hours, highlighting the importance of timely engagement[45]. - The customer satisfaction (CSAT) score has consistently been high, with a score of 95% over the past five years and 98%+ in the last two years[11]. - The company achieved a 13% completion rate for recent customer satisfaction surveys, indicating potential variability in customer satisfaction levels[172]. Product and Technology - The platform offers a robust suite of AI-powered solutions, including social listening, reporting, and analytics, to enhance business decision-making[54][53]. - The platform enables customers to process over 1 billion messages daily, providing critical insights and driving impactful results from day one[11]. - The proprietary AI and automation access over 10 years of historical social data sets and 15 years in sentiment and textual analysis[11]. - The platform allows for automated scheduling of content across social networks, optimizing reach through machine learning[66]. - The software used by the company is complex and may contain undetected errors or vulnerabilities, potentially leading to platform malfunctions and loss of customers[200]. Financial Performance and Expenses - Sales and marketing expenses for the year ended December 31, 2024, were $184.1 million, up from $168.1 million in 2023 and $123.7 million in 2022[93]. - Research and development expenses were $102.8 million for the year ended December 31, 2024, compared to $79.6 million in 2023 and $61.4 million in 2022[99]. - The company incurred net losses of $62.0 million, $66.4 million, and $50.2 million in 2024, 2023, and 2022, respectively, with an accumulated deficit of $354.4 million as of December 31, 2024[187]. - The company plans to continue investing in research and development and sales and marketing efforts, anticipating that operating expenses will continue to increase as it scales its business[187]. Competitive Landscape and Market Challenges - The company faces significant competition in the social media management platform market, requiring continuous innovation and effective marketing strategies to maintain its market position[205]. - The sales cycle for larger enterprise customers is becoming longer and more expensive, potentially leading to increased pricing pressure[168]. - The company may face pricing pressures from competitors offering lower-priced alternatives, impacting its revenue and profitability[207]. - The company recognizes subscription revenue ratably over contract terms, making it difficult to immediately reflect changes in new sales or renewals in financial results[169]. Employee Engagement and Well-being - In 2024, Sprout Social launched its first Culture Survey, achieving a 64% response rate and an Employee Net Promoter Score (eNPS) of 32, indicating strong employee advocacy[126]. - The total rewards philosophy in 2024 included globally competitive compensation packages, with annual salary reviews based on market data to ensure fairness[129]. - Sprout Social offered a $5,000 family planning benefit for surrogacy and adoption, along with a global parental leave program providing equal time off for all parents[131]. - The company emphasized employee development through its Grow@ platform, providing access to digital learning resources and specialized training programs[124]. - Sprout Social's commitment to employee well-being included mental health resources, financial wellness tools, and backup care options[136]. Regulatory and Compliance Risks - Legal and regulatory obligations related to data privacy and security are stringent and evolving, with potential penalties for non-compliance that could impact business operations[209]. - The company must adapt to various data privacy laws globally, including the EU GDPR and Brazil's LGPD, which impose strict compliance requirements[212]. - The company is subject to the EU's Digital Services Act, which may necessitate changes in business practices to comply with new legal obligations[214]. - Compliance with the Payment Card Industry Data Security Standard (PCI DSS) is required, necessitating measures to secure cardholder information[220]. Cybersecurity and Operational Risks - The company relies on information technology systems for sensitive data, and any cybersecurity-related attack could negatively impact its business and reputation[188]. - The company faces risks from evolving cybersecurity threats, including ransomware and supply-chain attacks, which could disrupt operations and lead to reputational harm[227]. - Significant resources are expended to protect against security incidents, but there is no assurance that implemented measures will be effective[230]. - Security incidents may lead to government enforcement actions, litigation, and reputational harm, negatively impacting customer retention and growth[231].

Investor Presentation 4Q FY24 Disclaimers Forward-Looking Statements This presentation contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. In some cases, you can identify forward-looking statements by terms such as "anticipate," "believe," "can," "continue," "could," "estimate," "expect," "explore," "future," "intend," "long-term operating model," "medium to long-term goals," "m ...

Sprout Social (SPT) Q4 2024 Earnings Call February 26, 2025 02:32 AM ET Company Participants Alex Kurtz - VP - IR & Corporate DevelopmentRyan Barretto - CEOJoe Del Preto - CFORaimo Lenschow - Managing DirectorParker Lane - Managing Director - Equity ResearchScott Berg - Managing DirectorPatrick Schulz - Vice President & Senior Research AssociateJackson Ader - Managing Director Conference Call Participants David Hynes Jr. - Managing Director, Software Lead AnalystArjun Bhatia - Partner, Co-Head Tech Equity R ...