Tenable(TENB) - 2024 Q4 - Annual Results

Financial Highlights Fourth Quarter 2024 Financial Highlights Tenable reported strong Q4 2024 results with 11% year-over-year growth in revenue and billings, shifting to GAAP operating income and achieving substantial non-GAAP profitability Q4 2024 vs. Q4 2023 Key Financial Metrics | Metric | Q4 2024 | Q4 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $235.7 Million | $213.3 Million | +11% | | Calculated Current Billings | $302.2 Million | $271.6 Million | +11% | | GAAP Income (Loss) from Operations | $13.0 Million | ($14.3 Million) | N/A | | Non-GAAP Income from Operations | $59.4 Million | $36.1 Million | +64.5% | | GAAP Net Income (Loss) | $1.9 Million | ($21.6 Million) | N/A | | Non-GAAP Net Income | $50.7 Million | $30.2 Million | +67.9% | | GAAP Diluted EPS | $0.02 | ($0.19) | N/A | | Non-GAAP Diluted EPS | $0.41 | $0.25 | +64.0% | | Unlevered Free Cash Flow | $85.7 Million | $43.3 Million | +97.9% | * The company repurchased 1.2 million shares of its common stock for $50.0 million during the fourth quarter[7] * Company leadership attributed the outperformance to strong traction in cloud security and the Tenable One platform[3] Full Year 2024 Financial Highlights For 2024, Tenable achieved 13% revenue growth to $900.0 million, significantly narrowing GAAP losses and substantially increasing non-GAAP income and cash flow Full Year 2024 vs. 2023 Key Financial Metrics | Metric | Full Year 2024 | Full Year 2023 | Change | | :--- | :--- | :--- | :--- | | Revenue | $900.0 Million | $798.7 Million | +13% | | Calculated Current Billings | $969.5 Million | $873.3 Million | +11% | | GAAP Loss from Operations | ($6.9 Million) | ($52.2 Million) | +86.8% Improvement | | Non-GAAP Income from Operations | $184.1 Million | $121.0 Million | +52.2% | | GAAP Net Loss | ($36.3 Million) | ($78.3 Million) | +53.6% Improvement | | Non-GAAP Net Income | $158.6 Million | $97.2 Million | +63.2% | | GAAP Net Loss Per Share | ($0.31) | ($0.68) | +54.4% Improvement | | Non-GAAP Diluted EPS | $1.29 | $0.80 | +61.3% | | Unlevered Free Cash Flow | $237.8 Million | $175.4 Million | +35.6% | * Cash and cash equivalents and short-term investments increased to $577.2 million at year-end, up from $474.0 million at the end of 2023[7] * The company repurchased 2.3 million shares of its common stock for $100.0 million during the full year[7] Business and Operations Recent Business Highlights Tenable demonstrated strong business momentum through customer growth, a strategic acquisition, and product enhancements for patch management and vulnerability intelligence * Customer growth included the addition of 485 new enterprise platform customers and 135 net new six-figure customers[10] * Announced the intent to acquire exposure management company Vulcan Cyber Ltd. to enhance its platform with better visibility, risk prioritization, and remediation capabilities[10] * Launched Tenable Patch Management, an autonomous solution to accelerate the closing of vulnerability exposures[10] * Enhanced Tenable Security Center by integrating Tenable Vulnerability Intelligence to streamline vulnerability analysis and response[10] Financial Outlook First Quarter 2025 Outlook For Q1 2025, Tenable projects revenue between $232.0 million and $234.0 million, with non-GAAP operating income of $42.0 million to $44.0 million, excluding acquisition impact Q1 2025 Financial Outlook | Metric | Low Range | High Range | | :--- | :--- | :--- | | Revenue | $232.0 Million | $234.0 Million | | Non-GAAP Income from Operations | $42.0 Million | $44.0 Million | | Non-GAAP Net Income | $35.0 Million | $37.0 Million | | Non-GAAP Diluted EPS | $0.28 | $0.30 | * The financial outlook for Q1 2025 does not include any impact from the potential acquisition of Vulcan Cyber[9] Full Year 2025 Outlook For full year 2025, Tenable forecasts revenue between $971.0 million and $981.0 million, calculated current billings over $1 billion, and significant non-GAAP operating income and free cash flow Full Year 2025 Financial Outlook | Metric | Low Range | High Range | | :--- | :--- | :--- | | Calculated Current Billings | $1.040 Billion | $1.055 Billion | | Revenue | $971.0 Million | $981.0 Million | | Non-GAAP Income from Operations | $213.0 Million | $223.0 Million | | Non-GAAP Net Income | $189.0 Million | $199.0 Million | | Non-GAAP Diluted EPS | $1.52 | $1.60 | | Unlevered Free Cash Flow | $285.0 Million | $295.0 Million | Consolidated Financial Statements Consolidated Statements of Operations For 2024, Tenable's revenue grew to $900.0 million, significantly reducing operating and net losses, reflecting improved operational efficiency and cost management Annual Statement of Operations Highlights (in thousands) | Line Item | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Revenue | $900,021 | $798,710 | | Gross Profit | $700,353 | $615,133 | | Total Operating Expenses | $707,209 | $667,293 | | Income (Loss) from Operations | ($6,856) | ($52,160) | | Net Income (Loss) | ($36,301) | ($78,284) | | Diluted EPS | ($0.31) | ($0.68) | * Total stock-based compensation for 2024 was $163.5 million, an increase from $145.3 million in 2023[24] Consolidated Balance Sheets As of December 31, 2024, Tenable's balance sheet showed a stronger financial position with total assets increasing to $1.74 billion and stockholders' equity rising to $400.0 million Balance Sheet Highlights (in thousands) | Line Item | Dec 31, 2024 (in thousands) | Dec 31, 2023 (in thousands) | | :--- | :--- | :--- | | Cash, Cash Equivalents & Short-term Investments | $577,194 | $473,972 | | Total Current Assets | $940,745 | $805,473 | | Total Assets | $1,742,119 | $1,606,871 | | Deferred Revenue (Current + Non-current) | $833,187 | $750,497 | | Total Liabilities | $1,342,165 | $1,260,527 | | Total Stockholders' Equity | $399,954 | $346,344 | Consolidated Statements of Cash Flows For 2024, Tenable generated $217.5 million in cash from operating activities, with cash and cash equivalents increasing by $91.5 million despite significant share repurchases Annual Statement of Cash Flows Highlights (in thousands) | Line Item | 2024 (in thousands) | 2023 (in thousands) | | :--- | :--- | :--- | | Net cash provided by operating activities | $217,476 | $149,855 | | Net cash used in investing activities | ($41,431) | ($212,615) | | Net cash (used in) provided by financing activities | ($79,401) | $1,251 | | Net increase (decrease) in cash | $91,515 | ($63,734) | | Cash and cash equivalents at end of year | $328,647 | $237,132 | Non-GAAP Financial Measures and Reconciliations Explanation of Non-GAAP Financial Measures Tenable uses non-GAAP measures like Calculated Current Billings, Unlevered Free Cash Flow, and Non-GAAP Income from Operations to provide a clearer view of core operating performance * Calculated Current Billings: Defined as total revenue plus the change in current deferred revenue for the period, used to monitor working capital generation from upfront customer payments[15] * Unlevered Free Cash Flow: Defined as net cash from operations less capital expenditures, plus cash paid for interest, measuring cash available for investment and debt obligations[17] * Non-GAAP Income from Operations: Excludes stock-based compensation, acquisition-related expenses, restructuring, and amortization of acquired intangible assets for comparable operating results[18] Reconciliation of GAAP to Non-GAAP Measures The report provides detailed reconciliations, adjusting the 2024 GAAP operating loss of $6.9 million to a non-GAAP operating income of $184.1 million, primarily for stock-based compensation and amortization Reconciliation of GAAP to Non-GAAP Income from Operations (Full Year 2024, in thousands) | Description | Amount (in thousands) | | :--- | :--- | | GAAP Loss from Operations | ($6,856) | | Stock-based compensation | $163,515 | | Amortization of acquired intangible assets | $19,457 | | Restructuring | $6,070 | | Acquisition-related expenses | $1,932 | | Non-GAAP Income from Operations | $184,118 | Reconciliation of GAAP to Non-GAAP Net Income (Full Year 2024, in thousands) | Description | Amount (in thousands) | | :--- | :--- | | GAAP Net Loss | ($36,301) | | Stock-based compensation | $163,515 | | Amortization of acquired intangible assets | $19,457 | | Restructuring | $6,070 | | Other adjustments (tax impacts, etc.) | $5,848 | | Non-GAAP Net Income | $158,589 | Reconciliation of Net Cash from Operations to Unlevered Free Cash Flow (Full Year 2024, in thousands) | Description | Amount (in thousands) | | :--- | :--- | | Net cash provided by operating activities | $217,476 | | Purchases of property and equipment | ($4,247) | | Capitalized software development costs | ($6,451) | | Free cash flow | $206,778 | | Cash paid for interest and other financing costs | $30,977 | | Unlevered free cash flow | $237,755 |