Financial Data and Key Metrics Changes - Sprout Social reported revenue of $115.6 million for Q3 2025, reflecting a 13% year-over-year growth and a non-GAAP operating margin expansion of nearly 460 basis points to a record high of 11.9% [5][24] - Remaining performance obligations (RPO) grew 17% year-over-year to $258.5 million, indicating strong demand and execution [5][26] - Non-GAAP operating income totaled $13.7 million, up from $7.5 million a year ago, marking a significant increase in profitability [24][26] Business Line Data and Key Metrics Changes - Subscription revenue reached $114.7 million, also up 13% year-over-year, with the number of customers contributing more than $50,000 in annual recurring revenue (ARR) growing by 21% [25] - The $50,000-plus ARR customer segment is now approaching 2,000 customers, accounting for nearly half of total revenue [6][7] - The company launched several new features, including AI-powered translation and integrations with Canva and Adobe Express, enhancing its service offerings [16][20] Market Data and Key Metrics Changes - The company experienced strong go-to-market momentum with the acquisition of NewsWeb, generating more pipeline than any new product in its history [14] - Strategic wins included partnerships with major global brands, indicating a strong market presence and customer commitment [6][14] Company Strategy and Development Direction - Sprout Social is focusing on enhancing its capabilities to serve larger customers while refining its approach to smaller accounts [7] - The company is rolling out a long-term AI strategy, anticipating significant product expansion in Q4 2025 [8][11] - The integration of NewsWeb is expected to create new pipelines and increase deal sizes, demonstrating the effectiveness of the company's social intelligence strategy [14][15] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to navigate the macro environment and highlighted the strong demand trends observed in Q3 [6][8] - The leadership emphasized the importance of social data and AI in shaping future business strategies, positioning Sprout Social as a leader in the next era of business software [10][11] Other Important Information - The company achieved a 19% automated resolution rate and a 65% reduction in time spent in the help center, showcasing improvements in customer support efficiency [21] - Sprout Social was named a preferred partner in Reddit's official data partner program, enhancing its standing in the social technology landscape [22] Q&A Session Summary Question: How does the company view its revenue growth and market momentum? - Management acknowledged the stable revenue growth and highlighted the progress in moving upmarket, with a focus on larger deals and customer segments [30] Question: What factors contributed to the increase in profitability this quarter? - Management attributed the profitability increase to revenue overperformance, improved efficiency, and strategic hiring [32]

Financial Data and Key Metrics Changes - The company reported Q2 2025 revenue of $111.8 million, representing a year-over-year growth of 12% [5][28] - Non-GAAP operating margin expanded by almost 400 basis points to 9.2% [5][27] - Non-GAAP free cash flow for the quarter was $5.2 million, an increase of 110% year-over-year [27][28] - Remaining performance obligations (RPO) totaled $347 million, up 18% year-over-year [29] Business Line Data and Key Metrics Changes - Subscription revenue was $111.1 million, reflecting a 13% year-over-year increase [28] - The number of customers contributing more than $50,000 in annual recurring revenue (ARR) grew by 18% year-over-year [28] - The average contract value (ACV) for Q2 was $15,321, up 14% year-over-year [28] Market Data and Key Metrics Changes - The company secured strategic wins with global brands such as Honda, Cigna, and the U.S. Department of Transportation, indicating strong market presence [6][38] - The company earned 164 Leader Badges in G2's reports, showcasing its competitive positioning in the market [6] Company Strategy and Development Direction - The acquisition of Newswhip is seen as a pivotal milestone to enhance AI-powered predictive media intelligence capabilities [8][9] - The company aims to deepen customer engagement through use case expansion and premium modules [21][23] - The strategy focuses on winning enterprise customers, improving customer health and adoption, and expanding partnerships [13][21] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the core business performance and noted strong retention and renewal rates [38][71] - The company anticipates some near-term pressure on rep productivity due to the integration of Newswhip [33] - Management highlighted the importance of social media as a channel for product discovery, especially among Gen Z consumers [25][102] Other Important Information - The company launched several product innovations, including enhancements in influencer marketing and customer care [14][16] - The company is expanding partnerships with key networks to enhance its capabilities [21] Q&A Session Summary Question: How would you characterize the core business today? - Management noted strong performance and progress, with significant wins and growth in the enterprise customer segment [38] Question: What is the impact of Newswhip on guidance? - Management projected Newswhip to contribute approximately $2.5 million over the final five months of the year, taking a cautious approach to guidance [41] Question: What is the timeline for integrating Newswhip? - Management indicated that integration efforts are underway, with positive initial feedback from customers [48] Question: How are rising advertising costs affecting customer strategies? - Management noted that customers are increasingly looking to social media for discovery due to disruptions in traditional search [60] Question: What are the trends in the international market? - Management acknowledged that while international business is smaller, there is strong potential for growth and pipeline development [85]

Financial Performance - Total revenue for Q2 FY2025 reached $111.8 million, compared to $99.4 million in Q2 FY2024[10] - The company achieved revenue growth of 12% year-over-year[7] - Average Contract Value (ACV) increased to $15,321 in Q2 FY2025, up from $13,403 in Q2 FY2024, representing 14% growth[7, 10] - Remaining Performance Obligation (RPO) grew to $347.0 million, compared to $295.1 million[10] - Current Remaining Performance Obligation (cRPO) increased to $251.6 million, compared to $212.5 million[10] - Non-GAAP Gross Margin remained consistent at 79%[10, 57] - Non-GAAP Operating Margin improved to 9%, compared to 5%[10, 57] - Non-GAAP Free Cash Flow (FCF) Margin increased to 5%, compared to 3%[10, 57] Customer Metrics - The company has approximately 30,000 customers across 100+ countries[7] - The number of customers contributing >=$10k in ARR increased to 9,517 from 8,966[10] - The number of customers contributing >=$50k in ARR increased to 1,826 from 1,545[10] Acquisition and Guidance - Sprout Social acquired NewsWhip for $55 million in cash, with up to $10 million in performance-based cash earnouts over two years[39] - The company projects total revenue for Q3 FY2025 to be between $114.4 million and $115.2 million, and for the full year FY2025 between $452.9 million and $455.9 million[45] - The company projects Non-GAAP Operating Income for Q3 FY2025 to be between $9.3 million and $10.3 million, and for the full year FY2025 between $43.1 million and $45.1 million[45]

Q1 FY2025 Performance Highlights - The company has approximately 30,000 customers across over 100 countries[7] - ACV growth was 16% year-over-year[7] - Revenue growth reached 13% year-over-year[7] - Subscription revenue accounted for 99% of total revenue[7] - The Non-GAAP FCF Margin was 18%[10] Q1 FY2025 Financial Overview (vs Q1 FY2024) - Total revenue was $109.3 million, compared to $96.8 million[10] - Customers contributing >=$10k in ARR increased from 8,823 to 9,381[10] - Customers contributing >=$50k in ARR increased from 1,449 to 1,766[10] - Average Contract Value (ACV) grew from $12,892 to $14,961[10] - Remaining Performance Obligation (RPO) increased from $290.0 million to $360.2 million[10] - Current Remaining Performance Obligation (cRPO) increased from $210.6 million to $255.8 million[10] - Non-GAAP Operating Margin increased from 6% to 11%[10] Q2 and FY2025 Guidance - Q2 FY2025 total revenue is projected to be between $110.4 million and $111.2 million[35] - FY2025 total revenue is projected to be between $448.9 million and $453.9 million[35] - FY2025 Non-GAAP Operating Income is expected to be between $40.7 million and $45.7 million[35] Long Term Operating Model - The company aims to achieve >$1 billion in revenue in the medium to longer term[48] - The company aims to achieve >80% Non-GAAP Gross Margin in the medium to longer term[48] - The company aims to achieve >20% Non-GAAP Operating Margin in the medium to longer term[48] - The company aims to achieve 20-22% Non-GAAP FCF Margin in the medium to longer term[48]