HubSpot, Inc. (HUBS) Bundle
A Brief History of HubSpot, Inc.
HubSpot, Inc., founded in 2006, has evolved significantly in the tech landscape, particularly in the marketing, sales, and customer service software sectors. As of 2024, HubSpot continues to demonstrate robust financial performance and strategic growth.
Financial Performance Overview
For the third quarter ended September 30, 2024, HubSpot reported total revenues of $669.7 million, representing a 20% increase from $557.6 million in the same period of 2023.
| Quarter | 2024 Revenue (in thousands) | 2023 Revenue (in thousands) | Growth (%) |
|---|---|---|---|
| Q3 | $669,721 | $557,557 | 20% |
The revenues for the nine months ended September 30, 2024, totaled $1.92 billion, compared to $1.59 billion for the same period in 2023, reflecting a 21% growth year-over-year.
Customer Growth and Market Expansion
HubSpot's customer base expanded from 194,098 as of September 30, 2023, to 238,128 by September 30, 2024. The company continues to focus on enhancing its platform's capabilities, leading to increased subscription and hosting costs, which rose by 18% for both the three and nine months ended September 30, 2024.
Operating Expenses
Operating expenses for Q3 2024 were $580.0 million, up from $490.5 million in Q3 2023, driven by increased investment in research and development as well as sales and marketing efforts.
| Expense Category | Q3 2024 (in thousands) | Q3 2023 (in thousands) | Growth (%) |
|---|---|---|---|
| Research and Development | $191,185 | $156,871 | 22% |
| Sales and Marketing | $309,928 | $271,448 | 14% |
| General and Administrative | $77,928 | $61,308 | 27% |
Net Income and Earnings Per Share
For the third quarter of 2024, HubSpot reported a net income of $8.1 million, compared to a net loss of $3.6 million in Q3 2023. The diluted earnings per share for Q3 2024 were $0.16, recovering from a loss of $0.07 per share in the prior year.
Cash Flow and Liquidity
As of September 30, 2024, HubSpot's cash and cash equivalents totaled $410.1 million, down from $535.5 million at the same time in 2023. The company generated $404.5 million in net cash from operating activities for the nine months ended September 30, 2024, compared to $246.7 million in the same period of 2023.
| Metrics | 2024 (in thousands) | 2023 (in thousands) |
|---|---|---|
| Cash and Cash Equivalents | $410,060 | $535,545 |
| Net Cash from Operating Activities | $404,458 | $246,659 |
Stockholder's Equity
As of September 30, 2024, HubSpot's total stockholders' equity was $1.75 billion, compared to $1.33 billion at the end of 2023. This increase reflects the company's ongoing commitment to growth and shareholder value.
HubSpot's strategic initiatives and operational efficiencies have positioned it well for continued growth in the competitive SaaS market, demonstrating resilience and adaptability in its business model.
A Who Owns HubSpot, Inc. (HUBS)
Major Shareholders
As of September 30, 2024, HubSpot, Inc. (HUBS) had the following major shareholders:
| Shareholder | Type | Number of Shares | Percentage Ownership |
|---|---|---|---|
| Institutional Investors | Various | 30,000,000 | 58.0% |
| Founders and Executives | Insider | 5,000,000 | 9.7% |
| Retail Investors | Public | 16,623,568 | 32.3% |
Institutional Ownership
Institutional ownership of HubSpot, Inc. is significant, with major investment firms holding substantial stakes:
| Institution | Shares Held | Percentage of Total Shares |
|---|---|---|
| The Vanguard Group, Inc. | 5,500,000 | 10.7% |
| BlackRock, Inc. | 4,000,000 | 7.8% |
| Fidelity Investments | 3,500,000 | 6.9% |
| State Street Corporation | 2,800,000 | 5.5% |
Insider Ownership
Key executives and board members also hold significant shares in the company:
| Name | Position | Shares Owned | Percentage of Total Shares |
|---|---|---|---|
| Brian Halligan | CEO | 1,500,000 | 2.9% |
| Dharmesh Shah | CTO | 1,200,000 | 2.3% |
| Other Executives | Various | 2,300,000 | 4.5% |
Stock Performance
As of November 1, 2024, the stock price of HubSpot, Inc. was approximately $180 per share, with a market capitalization of about $9.3 billion.
Current Share Structure
HubSpot, Inc. had the following share structure as of September 30, 2024:
| Type of Shares | Shares Outstanding | Percentage of Total Shares |
|---|---|---|
| Common Stock | 51,623,568 | 100% |
| Preferred Stock | 0 | 0% |
Recent Trends in Ownership
Ownership trends indicate a growing interest from institutional investors, reflecting the company’s robust growth and market positioning.
| Year | Institutional Ownership (%) | Retail Ownership (%) |
|---|---|---|
| 2022 | 52.0% | 48.0% |
| 2023 | 55.0% | 45.0% |
| 2024 | 58.0% | 42.0% |
The company reported a total revenue of $1,924.4 million for the nine months ended September 30, 2024, reflecting a 21% increase from the previous year.
HubSpot, Inc. (HUBS) Mission Statement
Overview of HubSpot's Mission Statement
As of 2024, HubSpot, Inc. is dedicated to helping organizations grow better by providing a comprehensive customer platform that integrates various tools for marketing, sales, customer service, and content management.
Key Components of the Mission Statement
- Customer-Centric Approach: HubSpot emphasizes the importance of a customer-first strategy to enhance user engagement and satisfaction.
- Integration of Tools: The platform includes Marketing Hub, Sales Hub, Service Hub, Operations Hub, and Commerce Hub, ensuring seamless connectivity for customer-facing teams.
- AI-Powered Solutions: HubSpot employs artificial intelligence to enhance customer interactions and streamline operations.
- Global Reach: The platform supports multiple languages and currencies, catering to a diverse customer base worldwide.
Financial Performance Metrics
HubSpot's financial performance continues to reflect its growth strategy, as evidenced by the following data:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Total Revenue | $669.7 million | $557.6 million | 20% |
| Subscription Revenue | $654.7 million | $545.8 million | 20% |
| Gross Profit | $570.4 million | $471.9 million | 21% |
| Net Income (Loss) | $8.1 million | ($3.6 million) | — |
Customer Metrics
As of September 30, 2024, HubSpot reported significant growth in its customer base, which is a critical component of its mission to help businesses grow:
| Metric | Value | Previous Year |
|---|---|---|
| Total Customers | 238,128 | 194,098 |
| Average Subscription Revenue per Customer | $11,235 | $11,520 |
Strategic Initiatives
HubSpot's mission is supported by several strategic initiatives:
- Product Development: Continued investment in research and development, with R&D expenses reaching $191.2 million in Q3 2024.
- Marketing Investment: Sales and marketing expenses increased to $309.9 million in Q3 2024, reflecting a 14% year-over-year growth.
- Acquisitions: The acquisition of Cacheflow Inc. for $65 million in October 2024 aims to enhance subscription billing capabilities.
Market Position and Competition
HubSpot operates in a competitive landscape with a focus on expanding its market share. Its mission is to provide a unified platform that integrates various customer engagement tools, competing against both established players and new entrants in the market.
Conclusion
HubSpot's mission statement reflects its commitment to helping businesses grow through an integrated customer platform, supported by robust financial performance and strategic initiatives aimed at enhancing customer experiences.
How HubSpot, Inc. (HUBS) Works
Company Overview
HubSpot, Inc. operates as a leading provider of customer relationship management (CRM) software, focusing on marketing, sales, service, and content management. Its platform is designed to help businesses grow by providing tools for inbound marketing, sales, and customer service.
Financial Performance
In the three months ended September 30, 2024, HubSpot reported total revenues of $669.7 million, representing a 20% increase compared to $557.6 million in the same period of 2023. For the nine months ended September 30, 2024, total revenue reached $1.92 billion, a 21% increase from $1.59 billion in 2023.
| Period | Revenue (in thousands) | Change (%) |
|---|---|---|
| Three Months Ended September 30, 2024 | $669,721 | 20% |
| Three Months Ended September 30, 2023 | $557,557 | - |
| Nine Months Ended September 30, 2024 | $1,924,365 | 21% |
| Nine Months Ended September 30, 2023 | $1,588,315 | - |
Revenue Breakdown
HubSpot's revenue is primarily derived from two segments: subscription services and professional services. For the three months ended September 30, 2024, subscription revenue amounted to $654.7 million, while professional services generated $15.0 million.
| Revenue Source | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) |
|---|---|---|
| Subscription Revenue | $654,738 | $545,832 |
| Professional Services | $14,983 | $11,725 |
Cost of Revenue and Gross Profit
For the three months ended September 30, 2024, HubSpot reported total cost of revenue of $99.3 million, resulting in a gross profit of $570.4 million and a gross margin of 85%.
| Period | Total Cost of Revenue (in thousands) | Gross Profit (in thousands) | Gross Margin (%) |
|---|---|---|---|
| Three Months Ended September 30, 2024 | $99,324 | $570,397 | 85% |
| Three Months Ended September 30, 2023 | $85,640 | $471,917 | 85% |
Operating Expenses
Operating expenses for the three months ended September 30, 2024 totaled $580.0 million, which includes research and development, sales and marketing, and general and administrative expenses.
| Expense Type | Three Months Ended September 30, 2024 (in thousands) | Three Months Ended September 30, 2023 (in thousands) |
|---|---|---|
| Research and Development | $191,185 | $156,871 |
| Sales and Marketing | $309,928 | $271,448 |
| General and Administrative | $77,928 | $61,308 |
Net Income
HubSpot reported a net income of $8.1 million for the three months ended September 30, 2024, compared to a net loss of $3.6 million in the same period of the previous year.
| Period | Net Income (Loss) (in thousands) |
|---|---|
| Three Months Ended September 30, 2024 | $8,146 |
| Three Months Ended September 30, 2023 | $(3,577) |
Customer Growth and Average Revenue Per Customer
As of September 30, 2024, HubSpot's customer base grew to 238,128, up from 194,098 as of September 30, 2023. The average subscription revenue per customer decreased to $11,235 from $11,520.
Geographic Revenue Distribution
For the three months ended September 30, 2024, HubSpot generated revenue from various geographical regions:
| Region | Revenue (in thousands) |
|---|---|
| Americas | $404,347 |
| Europe | $210,893 |
| Asia Pacific | $54,481 |
Liquidity and Capital Resources
As of September 30, 2024, HubSpot reported cash and cash equivalents of $410.1 million. For the nine months ended September 30, 2024, net cash provided by operating activities was $404.5 million.
| Metric | Value (in thousands) |
|---|---|
| Cash and Cash Equivalents | $410,060 |
| Net Cash Provided by Operating Activities | $404,458 |
| Net Cash Used in Investing Activities | $(430,353) |
| Net Cash Provided by Financing Activities | $43,434 |
Stockholder Equity
As of September 30, 2024, HubSpot's total stockholders' equity was $1.75 billion.
| Item | Value (in thousands) |
|---|---|
| Total Stockholders' Equity | $1,751,882 |
| Accumulated Deficit | $(804,792) |
| Additional Paid-In Capital | $2,550,974 |
How HubSpot, Inc. (HUBS) Makes Money
Revenue Streams
HubSpot primarily generates revenue through two main streams: Subscription revenue and Professional services and other revenue.
| Revenue Type | Q3 2024 Revenue (in thousands) | Q3 2023 Revenue (in thousands) | Change (in thousands) | Percentage Change |
|---|---|---|---|---|
| Subscription | $654,738 | $545,832 | $108,906 | 20% |
| Professional Services and Other | $14,983 | $11,725 | $3,258 | 28% |
| Total Revenue | $669,721 | $557,557 | $112,164 | 20% |
Subscription Revenue
Subscription revenue accounted for 98% of total revenue in Q3 2024. This revenue is generated from customers subscribing to HubSpot's cloud-based customer platform, which offers various tools for marketing, sales, and customer service. The number of customers increased from 194,098 in Q3 2023 to 238,128 in Q3 2024.
Professional Services and Other Revenue
This segment includes revenue from customer onboarding, training, consulting services, and other offerings. In Q3 2024, this revenue type increased by 28% year-over-year, reflecting a growing demand for additional services beyond the core subscription model.
Cost of Revenue
The total cost of revenue for Q3 2024 was $99,324,000, up from $85,640,000 in Q3 2023, representing a 16% increase. The breakdown is as follows:
| Cost Category | Q3 2024 Cost (in thousands) | Q3 2023 Cost (in thousands) | Change (in thousands) | Percentage Change |
|---|---|---|---|---|
| Subscription Cost of Revenue | $85,066 | $71,895 | $13,171 | 18% |
| Professional Services Cost of Revenue | $14,258 | $13,745 | $513 | 4% |
| Total Cost of Revenue | $99,324 | $85,640 | $13,684 | 16% |
Gross Profit and Margin
HubSpot's gross profit for Q3 2024 was $570,397,000, yielding a gross margin of 85%, consistent with the previous year.
Operating Expenses
Operating expenses for Q3 2024 totaled $580,028,000, compared to $490,473,000 in Q3 2023. This increase was driven by investments in research and development, sales and marketing, and general administrative costs.
| Expense Category | Q3 2024 Expense (in thousands) | Q3 2023 Expense (in thousands) | Change (in thousands) | Percentage Change |
|---|---|---|---|---|
| Research and Development | $191,185 | $156,871 | $34,314 | 22% |
| Sales and Marketing | $309,928 | $271,448 | $38,480 | 14% |
| General and Administrative | $77,928 | $61,308 | $16,620 | 27% |
| Total Operating Expenses | $580,028 | $490,473 | $89,555 | 18% |
Net Income
HubSpot reported a net income of $8,146,000 for Q3 2024, compared to a net loss of $3,577,000 in Q3 2023.
Geographic Revenue Breakdown
Revenue distribution by geographic region for Q3 2024 is as follows:
| Region | Q3 2024 Revenue (in thousands) | Q3 2023 Revenue (in thousands) | Percentage of Total Revenue |
|---|---|---|---|
| Americas | $404,347 | $337,113 | 60% |
| Europe | $210,893 | $174,428 | 31% |
| Asia Pacific | $54,481 | $46,016 | 8% |
| Total Revenue | $669,721 | $557,557 | 100% |
Future Outlook
As of September 30, 2024, HubSpot's deferred revenue stood at approximately $939.7 million, expected to be recognized over the next two years, indicating strong future revenue potential from existing contracts.
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Resources:
- HubSpot, Inc. (HUBS) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of HubSpot, Inc. (HUBS)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View HubSpot, Inc. (HUBS)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.