ON24(ONTF) - 2025 Q2 - Quarterly Results

Financial Highlights and Business Update ON24 reported Q2 2025 results that surpassed expectations, with total revenue of $35.3 million, achieving its sixth consecutive quarter of positive operating and free cash flow, marked by the highest gross retention rate in four years and growth in its enterprise customer base - CEO Sharat Sharan highlighted that Q2 results exceeded expectations, with improvements across key financial and customer metrics compared to the first half of the previous year, positioning the company for ARR growth by year-end[3] Q2 2025 Financial Highlights vs. Q2 2024 | Metric | Q2 2025 | Q2 2024 | | :--- | :--- | :--- | | Total Revenue | $35.3 million | $37.3 million | | Total ARR | $127.1 million | N/A | | GAAP Operating Loss | $(9.2) million | $(13.1) million | | Non-GAAP Operating Loss | $(0.9) million | $(0.3) million | | GAAP Net Loss per Share | $(0.17) | $(0.27) | | Non-GAAP Net Income per Share | $0.02 | $0.03 | | Adjusted EBITDA | $0.2 million | $0.8 million | | Net Cash from Operating Activities | $2.6 million | $1.4 million | | Free Cash Flow | $2.1 million | $0.9 million | - Recent business achievements in Q2 2025 include: - Growth in the customer base with over $100K in ARR, indicating traction in enterprise segments - Sequential ARR growth from regulated industries like financial services and life sciences - Increased adoption of AI-powered ACE solutions - Ranked 1 in the G2 Summer 2025 Report for Enterprise Webinar Platforms - Launched ON24 Translate, a new multilingual translation tool[13] Financial Outlook ON24 provided guidance for Q3 2025, expecting total revenue between $33.6 million and $34.2 million, and updated its full-year 2025 forecast to anticipate total revenue of $137.7 million to $138.7 million and non-GAAP net income per share of $0.02 to $0.05 Q3 2025 Financial Outlook | Metric | Guidance Range | | :--- | :--- | | Total Revenue | $33.6M - $34.2M | | Core Platform Revenue | $33.0M - $33.6M | | Non-GAAP Operating Loss | $(1.3)M - $(0.7)M | | Non-GAAP Net Income per Share | $0.00 - $0.02 | Full Year 2025 Financial Outlook | Metric | Guidance Range | | :--- | :--- | | Total Revenue | $137.7M - $138.7M | | Core Platform Revenue | $135.2M - $136.2M | | Non-GAAP Operating Loss | $(5.2)M - $(3.8)M | | Non-GAAP Net Income per Share | $0.02 - $0.05 | Financial Statements This section presents the company's consolidated balance sheets, statements of operations, cash flows, and reconciliation of GAAP to non-GAAP financial measures Condensed Consolidated Balance Sheets As of June 30, 2025, ON24 reported total assets of $235.1 million and total liabilities of $85.1 million, with cash, cash equivalents, and marketable securities totaling $179.6 million, a slight decrease from $182.7 million at the end of 2024 Balance Sheet Summary (in thousands) | Account | June 30, 2025 | December 31, 2024 | | :--- | :--- | :--- | | Cash, Cash Equivalents & Marketable Securities | $179,560 | $182,736 | | Total Assets | $235,116 | $250,953 | | Total Liabilities | $85,099 | $91,541 | | Total Stockholders' Equity | $150,017 | $159,412 | Condensed Consolidated Statements of Operations For the second quarter of 2025, ON24 reported total revenue of $35.3 million, a decrease from $37.3 million in Q2 2024, successfully narrowing its GAAP net loss to $7.3 million from $11.2 million year-over-year, reflecting improved operational efficiency Statement of Operations Summary - Q2 (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total Revenue | $35,333 | $37,349 | | Gross Profit | $26,532 | $27,811 | | Loss from Operations | $(9,172) | $(13,059) | | Net Loss | $(7,277) | $(11,175) | | Net Loss per Share (Basic & Diluted) | $(0.17) | $(0.27) | Condensed Consolidated Statements of Cash Flows In Q2 2025, net cash provided by operating activities was $2.6 million, a significant improvement from $1.4 million in the prior-year period, with free cash flow for the quarter more than doubling to $2.1 million from $0.9 million generated in Q2 2024 Cash Flow Summary - Q2 (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Cash Provided by Operating Activities | $2,567 | $1,388 | | Purchases of Property and Equipment | $(492) | $(490) | | Free Cash Flow | $2,075 | $898 | Reconciliation of GAAP to Non-GAAP Results The company provided detailed reconciliations for its non-GAAP metrics, reporting a Q2 2025 Non-GAAP operating loss of $0.9 million, Non-GAAP net income of $1.0 million ($0.02 per diluted share), and Adjusted EBITDA of $0.2 million, primarily excluding stock-based compensation and restructuring costs Reconciliation of GAAP Net Loss to Non-GAAP Net Income - Q2 (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Loss (GAAP) | $(7,277) | $(11,175) | | Stock-based compensation | $7,378 | $12,076 | | Restructuring costs | $724 | $501 | | Other adjustments | $151 | $138 | | Non-GAAP Net Income | $976 | $1,540 | Reconciliation of GAAP Net Loss to Adjusted EBITDA - Q2 (in thousands) | Metric | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Net Loss (GAAP) | $(7,277) | $(11,175) | | Adjustments (Taxes, Interest, D&A, etc.) | $9,498 | $11,949 | | Adjusted EBITDA | $221 | $774 | Revenue Breakdown In Q2 2025, Core Platform revenue was $34.6 million, representing 97.9% of total revenue, while revenue from the legacy Virtual Conference product was $0.8 million, continuing its decline as the company focuses on core offerings Revenue Breakdown by Product - Q2 (in thousands) | Product Line | Three Months Ended June 30, 2025 | Three Months Ended June 30, 2024 | | :--- | :--- | :--- | | Total Core Platform Revenue | $34,580 | $36,485 | | Total Virtual Conference Revenue | $753 | $864 | | Total Revenue | $35,333 | $37,349 | Supplementary Information This section provides definitions for key business metrics and explains the company's use of non-GAAP financial measures Definitions of Key Business Metrics The report defines key metrics, including the "Core Platform," which encompasses a suite of products for live and on-demand digital engagement, and "Annual Recurring Revenue (ARR)," which represents the annualized value of subscription contracts and is a key indicator of future revenue - The ON24 Core Platform includes products such as ON24 Elite (webinars), ON24 Breakouts, ON24 Forums, ON24 Go Live, ON24 Engagement Hub, ON24 Target, and the ON24 AI-powered ACE engine[14][15][16] - Annual Recurring Revenue (ARR) is defined as the annualized value of subscription contracts as of the measurement date, excluding professional services and legacy revenue[16] Non-GAAP Financial Measures ON24 utilizes non-GAAP financial measures such as non-GAAP operating income, non-GAAP net income, Adjusted EBITDA, and free cash flow to supplement its GAAP results, believing these metrics provide better consistency for comparing historical performance by excluding items like stock-based compensation, amortization, and restructuring costs - The company uses non-GAAP measures to evaluate ongoing operations and for internal planning, believing they are helpful to investors for consistency and comparability[18] - Non-GAAP measures are presented for supplemental purposes and have limitations, as they are not standardized under GAAP and may differ from how other companies calculate similar metrics[19][20]