Tenable Holdings, Inc. Q2 FY2025 earnings call

• Strong Q2 results: Beat guided metrics with 12% revenue Y/Y growth and 19% operating margin. Tenable One was 40% of total new sales, driven by growing adoption of exposure management. - Acquisition of Apex: Expanding AI Aware and AI SPM capabilities to secure the AI attack surface. - Three pillars of exposure management:
  • Unifying visibility: Over 300 validated integrations, AI enhancing asset discovery and classification.
  • Unifying insight: AI-powered suite to proactively identify threats, map attack paths, and prioritize risks.
  • Unifying action: Transforming Tenable One into a system of action with AI-driven remediation guidance. - Industry recognition: Forrester named Tenable a leader in unified vulnerability management, and IDC recognized Tenable as a major player in CNAPP.

In Q2, Tenable achieved 12% year-over-year revenue growth, with revenue at $247.3 million. Tenable One was 40% of total new sales. Recurring revenue was 96%. Cloud and VM were critical priorities for customers within Tenable One, and OT saw strong adoption. Gross margin was 82% for the quarter, flat relative to the previous quarter.

• Q3 2025: Expected revenue range of $246 million to $248 million; non-GAAP income from operations range of $52 million to $54 million; non-GAAP net income range of $44 million to $46 million; non-GAAP diluted EPS range of $0.36 to $0.37. - Full-year 2025: Calculated current billings expected range of $1.038 billion to $1.048 billion; revenue range of $981 million to $987 million; non-GAAP income from operations range of $205 million to $215 million; non-GAAP net income range of $179 million to $189 million; non-GAAP diluted EPS range of $1.45 to $1.53; unlevered free cash flow range of $265 million to $275 million. - Raised the midpoint of the guided range by $8 million and the high end by $3 million due to improved visibility in public sector renewals.

Forward-looking statements involve risks and uncertainties beyond control that could cause actual results to differ materially. Risks include those discussed in the most recent annual report on Form 10-K and subsequent SEC filings, related to market conditions, competition, and execution of strategic initiatives.

Q: Compare and contrast this quarter with 90 days ago, especially on U.S. Fed and commercial upsell.

A: Steve noted they beat expectations for CCB, raised the guide, and have better visibility in U.S. Fed renewal base. On commercial, Tenable One is 40% of new sales, driving upsell with strong pipeline and high conversion rates.

Q: Talk about competitive landscape in exposure space and Tenable One's differentiation.

A: Mark said Tenable is hybrid, offers unified visibility, insights, and actions across multiple asset types. They have high win rates, and analysts recognize them as leaders in exposure management and unified vulnerability management.

Q: Strategy to secure generative AI in enterprise with Apex.

A: Steve explained Apex accelerates AI investment, with AI Aware for discovery and AI SPM for cloud posture, and embedding Apex into Tenable One to provide platform-based AI security.

Q: Strength in OT and hybrid IT/OT environments.

A: Mark said OT had strong Q2, with growth in verticals like data centers, food processing, manufacturing, and entertainment, driven by convergence of IT/OT and consolidation on Tenable One.

Q: July performance and seasonality.

A: Steve mentioned they consider July performance and flow of business, with a seasonally strong federal quarter ahead and sizable pipeline opportunities.