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Marketing analytics software Semrush (NYSE:SEMR) reported Q2 CY2024 results beating Wall Street analysts' expectations, with revenue up 21.8% year on year to $90.95 million. Guidance for next quarter's revenue was also optimistic at $96.5 million at the midpoint, 3.4% above analysts' estimates. It made a GAAP profit of $0.01 per share, improving from its loss of $0 per share in the same quarter last year.
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Semrush (SEMR) Q2 CY2024 Highlights:
- Revenue: $90.95 million vs analyst estimates of $89.78 million (1.3% beat)
- EPS: $0.01 vs analyst estimates of $0.03 (-$0.02 miss)
- Revenue Guidance for Q3 CY2024 is $96.5 million at the midpoint, above analyst estimates of $93.34 million
- The company lifted its revenue guidance for the full year from $367.5 million to $374 million at the midpoint, a 1.8% increase
- Gross Margin (GAAP): 83.6%, up from 82.6% in the same quarter last year
- Free Cash Flow of $7.64 million, down 36.3% from the previous quarter
- Net Revenue Retention Rate: 107%, in line with the previous quarter
- Customers: 116,000, up from 112,000 in the previous quarter
- Market Capitalization: $1.94 billion
Started by Oleg Shchegolev while still in university, Semrush (NYSE:SEMR) is a software as a service platform that helps companies optimize their search engine and content marketing efforts.
Listing Management SoftwareAs the number of places that keep business listings (such as addresses, opening hours and contact details) increases, the task of keeping all listings up-to-date becomes more difficult and that drives demand for centralized solutions that update all touchpoints.
Sales GrowthAs you can see below, SEMrush's revenue growth has been impressive over the last three years, growing from $45.01 million in Q2 2021 to $90.95 million this quarter.
This quarter, SEMrush's quarterly revenue was once again up a very solid 21.8% year on year. On top of that, its revenue increased $5.14 million quarter on quarter, a very strong improvement from the $2.42 million increase in Q1 CY2024. This is a sign of acceleration of growth and great to see.
Next quarter's guidance suggests that SEMrush is expecting revenue to grow 22.6% year on year to $96.5 million, improving on the 19.6% year-on-year increase it recorded in the same quarter last year. Looking ahead, analysts covering the company were expecting sales to grow 18.4% over the next 12 months before the earnings results announcement.
Customer Growth SEMrush reported 116,000 customers at the end of the quarter, an increase of 4,000 from the previous quarter. That's roughly the same customer growth as we observed last quarter and quite a bit above what we've typically seen over the last year, confirming that the company is sustaining a good sales pace.
Key Takeaways from SEMrush's Q2 Results It was great to see SEMrush's optimistic revenue guidance and outlook for the full year, which exceeded analysts' expectations. We were also this quarter's revenue came in higher than Wall Street's estimates. Overall, these results seemed fairly positive and shareholders should feel optimistic. The stock remained flat at $12.91 immediately after reporting.
