Financial Data and Key Metrics Changes - In Q2 2025, the company achieved a revenue of $247.3 million, reflecting a 12% year-over-year growth and exceeding the midpoint of the guided range by $5.3 million [26][27] - The operating margin for the quarter was 19%, approximately 100 basis points better than the midpoint of the guided range [29] - Calculated current billings grew 8% year-over-year to $238.6 million, indicating strong momentum with the Tenable One platform [25] - The net dollar expansion rate was 107% for the quarter, demonstrating robust customer retention and upsell [25][70] Business Line Data and Key Metrics Changes - The exposure management platform, Tenable One, accounted for 40% of total new sales in the quarter, highlighting its growing adoption [5][25] - The company added 367 new enterprise platform customers and 76 net new six-figure customers during the quarter, indicating strong demand for its solutions [25][70] - The percentage of recurring revenue remained high at 96%, showcasing the stability of the revenue model [27] Market Data and Key Metrics Changes - The public sector showed better-than-expected performance, particularly in the SLED business, driven by strong platform sales [7][8] - The company noted an improvement in visibility within the U.S. Federal market, particularly regarding renewals, despite a cautious spending environment [8][42] Company Strategy and Development Direction - The company is focused on expanding its AI capabilities and integrating them into the Tenable One platform, particularly following the acquisition of Apex Security [6][24] - The strategic emphasis is on preemptive security, which involves reducing risk before breaches occur, rather than just responding to incidents [8][14] - The company aims to unify visibility, insights, and actions across hybrid environments, positioning itself as a leader in exposure management [16][60] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to drive momentum, particularly in the federal market, with a strong pipeline and opportunities for growth [42][44] - The outlook for Q3 and the full year 2025 has been raised, reflecting improved visibility and performance in the public sector [34] - The company anticipates continued growth in long-term RPO, with a 40% year-over-year increase, indicating strong customer commitment [25][70] Other Important Information - The company has a strong cash position with $387 million in cash and short-term investments, providing flexibility for future investments and share repurchases [30] - The company announced a $250 million increase to its share repurchase program, demonstrating a commitment to returning capital to shareholders [31] Q&A Session Summary Question: Comparison of current quarter performance with previous expectations - Management noted improved visibility in the federal business and a strong pipeline, leading to an upward revision of guidance [42][44] Question: Expectations for Tenable One penetration and growth - Management highlighted that Tenable One represents over 40% of new sales and is expected to drive further growth with modest movement in penetration [46][50] Question: Competitive landscape in exposure management - Management emphasized the differentiation of Tenable One through its hybrid capabilities and unified platform approach, leading to high win rates against competitors [58][60] Question: Impact of larger deal sizes on new logos versus renewals - Management indicated that while gross dollar renewal rates remain strong, new business from new logos is driving growth, particularly with the Tenable One platform [67][70] Question: Strategy for securing generative AI in enterprises - The company is leveraging AI to enhance customer security programs and has integrated Apex capabilities to address AI-related risks [76][78] Question: Performance trends in July - Management noted that July has been trending ahead of historical seasonality, indicating positive momentum as the third quarter progresses [115]

Financial Performance - Q2 2025 revenue reached $247.3 million[11], with a 12% revenue growth[11] - Q2 2025 unlevered free cash flow was $44.3 million[11] - Q2 2025 non-GAAP gross margin was 82%[11] - Q2 2025 recurring revenue was 96%[11] - The forecast for FY 2025 revenue is $981.0 million to $987.0 million[54] - The forecast for FY 2025 unlevered free cash flow is $265.0 million to $275.0 million[54] Market Position and Opportunity - The company has approximately 44,000 customers[11] - The company is the 1 market share leader in Vulnerability Management[11] - Exposure Management is estimated to be a $50 billion market opportunity[27] - The Exposure Management market is expected to have a 20% CAGR from 2025-2027[28] Product and Strategy - The company aggregates 1.5 billion assets[25], normalizes 100+ 3rd party integrations[25], and classifies 150 billion exposures[25]

Core Insights - Tenable One has achieved over 300 validated integrations, positioning it as the most interconnected exposure management platform in the market, enhancing visibility and risk reduction for security teams [1][2][3] Group 1: Platform Features and Benefits - The platform addresses the fragmentation in cybersecurity tools, which averages 83 per enterprise, by providing a unified view of the attack surface, thus reducing blind spots for security teams [2][3] - Tenable One integrates data from various security tools, including EDR, CNAPP, and PAM, to deliver a contextualized risk view, enabling teams to visualize attack paths and focus on critical exposures [3][4] - The platform automates remediation workflows and enhances collaboration across teams, significantly decreasing the time required to investigate and resolve security exposures [4] Group 2: Customer Impact and Ecosystem - Two-thirds of Tenable One customers utilize its integrations, with reported benefits including up to 10x greater visibility and a 75% reduction in time spent on data aggregation, allowing teams to concentrate on proactive risk management [5] - Tenable is launching a universal integrations connector to facilitate the development of custom integrations, reinforcing its commitment to an open ecosystem and enabling organizations to tailor the platform to their needs [6] Group 3: Partnerships and Industry Collaboration - Partnerships with companies like Splunk and ServiceNow enhance the platform's capabilities, allowing for faster threat detection and response through deep integration of exposure data [7][8] - The collaboration with CyberArk focuses on securing privileged access, combining vulnerability insights with intelligent controls to mitigate risks effectively [8]

Financial Performance - Q1 2025 revenue reached $239.1 million[12] - Q1 2025 unlevered free cash flow was $86.8 million[12] - Q1 2025 non-GAAP gross margin was 82%[12] - Q1 2025 recurring revenue was 96%[12] - The company forecasts revenue between $970 million and $980 million for the full year 2025[52] - The company forecasts unlevered free cash flow between $265 million and $275 million for the full year 2025[52] Market Position and Growth - The company is a category leader in Exposure Management[11] - The company has approximately 44,000 customers[12] - The company is ranked 1 in market share in Vulnerability Management[12, 23] - The total addressable market for cyber exposure is estimated at $33 billion with an 18% CAGR[29]

Core Insights - Tenable has been recognized as a Major Player in the inaugural IDC MarketScape: Worldwide Cloud-Native Application Protection Platform (CNAPP) 2025 Vendor Assessment, highlighting its strong position in the market [1][2]. Company Overview - Tenable is identified as an exposure management company that focuses on closing cybersecurity gaps that can undermine business value, reputation, and trust [7]. - The company serves approximately 44,000 customers globally, providing a unified security visibility and action platform that spans various environments, including IT infrastructure and cloud [7]. Product Capabilities - Tenable Cloud Security offers a comprehensive CNAPP solution that integrates seamlessly with Tenable One, enabling organizations to secure their entire cloud stack without needing additional tools [3]. - The platform provides tailored visibility for specific cloud providers such as AWS, GCP, Azure, and Oracle Cloud, simplifying the interpretation of security findings for personnel [4]. - It emphasizes context-rich prioritization and identity-intelligent risk analysis, allowing for the identification of critical vulnerabilities and toxic access combinations that may be overlooked by other solutions [4]. Market Recognition - The IDC MarketScape assessment involved structured discussions, interviews with market leaders, and end-user experiences, validating Tenable's strategies and capabilities in the CNAPP space [2]. - Eric Doerr, the chief product officer of Tenable, stated that this recognition underscores the company's commitment to helping customers manage risk across their cloud environments and overall attack surface [5].

Core Viewpoint - Tenable Holdings, Inc. intends to acquire Apex Security, Inc. to enhance its capabilities in managing cyber risks associated with the expanding AI attack surface [1][5]. Group 1: Acquisition Details - The acquisition aims to strengthen Tenable's ability to help organizations identify and mitigate cyber risks in an AI-driven environment [1]. - Apex Security, founded in 2023, has gained attention from notable investors and is recognized for its innovative approach to securing AI usage [3]. - The financial terms of the acquisition have not been disclosed, and the deal is expected to close later this quarter [5]. Group 2: Industry Context - The rapid expansion of generative AI tools and autonomous systems is increasing the attack surface, introducing new risks such as shadow AI applications and AI-generated code [2]. - Tenable's existing product, Tenable AI Aware, already assists thousands of organizations in detecting and assessing AI usage, and the addition of Apex's capabilities will enhance governance and policy enforcement [2][3]. - The integration of Apex's offerings into Tenable One is anticipated to deliver comprehensive exposure management solutions in the second half of 2025 [5]. Group 3: Strategic Implications - Tenable's strategy focuses on staying ahead of attack surface expansion by not only managing exposures but also eliminating them proactively [3]. - The acquisition aligns with the industry's trend of treating AI risks as part of broader exposure management rather than in isolation [4]. - The collaboration is expected to provide security teams with the necessary visibility and control to manage AI-generated exposure effectively [3][4].

Summary of Tenable's Earnings Call Company Overview - **Company**: Tenable, a cyber exposure company focused on understanding and reducing risk through vulnerability management and exposure management platforms [2][3] Key Financial Highlights - **Revenue**: $239 million, representing an 11% growth, exceeding expectations [3] - **Operating Margin**: Strong at 20% [4] - **Free Cash Flow**: Over $80 million of unlevered free cash flow [4] - **New Customers**: Added over 300 new enterprise platform customers [4] - **Record Deals**: Achieved a record number of seven-figure deals [4] Guidance and Market Outlook - **Cautious Guidance**: Revised guidance downwards by approximately $17 million, reflecting potential longer sales cycles, particularly in the U.S. public sector [8][9] - **Public Sector Dynamics**: 15% of sales come from the U.S. public sector, which is experiencing personnel disruptions affecting sales cycles [7][9] - **Strong Demand**: Despite cautious guidance, the top of the funnel remains strong with good momentum in demand generation [6][10] Strategic Initiatives - **Platform Consolidation**: Tenable One is driving 30% to 40% of new business, focusing on consolidating various security solutions into one platform [17][21] - **FedRAMP Certification**: Achieved certification for Tenable One, enhancing credibility and opportunities in the federal government space [13][19] - **AI Integration**: Emphasizing AI as a key component for enhancing risk insights and operational efficiency [24][47] Competitive Landscape - **Market Position**: Tenable is well-positioned in the exposure management market, differentiating itself from competitors who are not as focused on this area [54][55] - **Cloud Security Growth**: Cloud security is one of the fastest-growing areas, with a 100% growth last year [66] - **Challenges from Competitors**: Noted pressure from larger platform vendors offering VM features, but Tenable maintains a strong competitive edge due to its established customer base and product offerings [51][56] Future Growth Opportunities - **Focus on Innovation**: Investing over 20% in R&D to drive product innovation and market expansion [29][78] - **Public Sector as a Tailwind**: Long-term growth expected from public sector contracts, leveraging past successes in the Department of Defense [80] - **Acquisition Strategy**: Recent acquisition of Vulcan aimed at accelerating market presence and product offerings [29][78] Conclusion - **Optimistic Outlook**: Despite short-term challenges, Tenable remains confident in its growth trajectory, driven by strong demand, innovative product offerings, and strategic positioning in the market [80]

Core Insights - Tenable has introduced significant enhancements to its flagship platform, Tenable One, including Tenable One Connectors and customizable risk dashboards, aimed at providing a comprehensive exposure management solution [1][6] - The platform addresses the challenges posed by the fragmented security landscape, where organizations typically manage an average of 83 disconnected tools, leading to operational inefficiencies and blind spots [2][6] - Tenable One integrates data from both native and third-party security tools, offering a unified view of organizational risk and enabling faster, smarter security decisions [3][4] Product Features - The new ecosystem of out-of-the-box Connectors allows seamless integration with various third-party tools, enhancing endpoint detection, cloud security, and vulnerability management [3] - The Tenable Exposure Data Fabric serves as the platform's scalable, cloud-native architecture, which normalizes and connects data across the security ecosystem [4] - Customizable risk dashboards are designed to streamline reporting processes, providing security teams with tailored insights that align with specific business roles and priorities [5] Market Context - The cybersecurity market is characterized by a saturation of point solutions that operate in isolation, which can hinder security efforts and leave organizations vulnerable [6] - Tenable's acquisition of Vulcan Cyber is highlighted as a strategic move to enhance its capabilities in the exposure management market, reinforcing its commitment to providing comprehensive security solutions [6][8]

Heritage Insurance Holdings, Inc. (HRTG) reported mixed first-quarter 2025 results, wherein the bottom line beat the Zacks Consensus Estimate but the top line missed the same. Net premiums earned improved 11.5%, driven by the strong performance of operating businesses. Combined ratio improved 950 basis points (bps) from the prior-year quarter’s level to 84.5.Heritage CEO Ernie Garateix stated, “The first quarter of 2025 marked the third consecutive quarter in which Heritage was impacted by significant catas ...

Financial Data and Key Metrics Changes - Rapid7 ended 2024 with $840 million in ARR, growing 4% year over year [6][22] - Full year revenue reached $844 million, a 9% increase from the previous year, exceeding guidance [24] - Operating income was $164 million, representing a 19% operating margin, an expansion of over 600 basis points from the prior year [24] - Free cash flow for the year was $154 million, with a free cash flow margin of 18%, an increase of over 800 basis points from the prior year [25] Business Line Data and Key Metrics Changes - The Detection and Response (DNR) business generated over $400 million in ARR, with managed DNR growing in the mid-teens [7][14] - The risk and exposure management business showed over 20% year-over-year growth in pipeline generation during Q4 [7] - ARR per customer grew 2% year over year to approximately $72,000 [23] Market Data and Key Metrics Changes - International revenue grew 14% year over year, accounting for 25% of total revenue, while North America grew 3% and made up 75% of the mix [26] - The total customer base increased by 2% year over year, ending 2024 with over 11,700 customers globally [23] Company Strategy and Development Direction - The company is focusing on innovation in its detection and response offerings, expanding coverage and leveraging AI capabilities [8][10] - Rapid7 is scaling its partner ecosystem, with 80% to 90% of new ARR booked through the channel [8] - The launch of Exposure Command is seen as a significant milestone, validating the integrated approach to attack surface management [9][16] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the foundational work completed in 2024, positioning the company for more consistent execution and sustainable growth [10][12] - The company expects ARR growth of 4% to 6% in 2025, primarily driven by the DNR business [18][29] - Management acknowledged the competitive landscape but emphasized the strategic value of their integrated security operations platform [10][90] Other Important Information - The company plans to reinvest up to $30 million into strategic growth initiatives, including expanding MDR service capabilities and establishing an innovation center in India [20][30] - An Analyst Day is planned for later in the year to provide deeper insights into the business and strategy [21] Q&A Session Summary Question: Clarification on ARR for Detection and Response - Management confirmed that the DNR business is growing in the mid-teens, with the remainder of ARR being a mix of cloud VM and legacy products [34][35] Question: Margin Outlook for Managed DNR - Management indicated that overall product gross margins will remain stable in the mid-seventies, but managed services will have lower gross margins due to labor components [39] Question: Competitive Landscape in Cloud Security - Management highlighted the focus on integrated exposure management to reduce complexity for customers, targeting a broader market [46][47] Question: Confidence in Net New ARR Growth - Management expressed confidence in the pipeline and early conversion rates, expecting improvements in net new ARR throughout the year [74][76] Question: Churn and Downsell Pressure in VM - Management noted that churn in the VM segment is stabilizing, with expectations for improved retention as customers transition to more integrated products [98][99] Question: Strategic Options for Declining ARR - Management is considering all options for the declining ARR segment, focusing on customer pain points and the complexity of managing risk [104][105]