HubSpot, Inc. HUBS reported impressive fourth-quarter 2024 results, with both top and bottom lines surpassing the Zacks Consensus Estimates. The company reported a top-line expansion year over year, backed by growing user engagement across all segments.

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The integration of advanced AI tools across its product suites and customer platform drives growth.

Net Income of HUBS

On a GAAP basis, the company recorded a net income of $4.9 million or 9 cents per share against a loss of $12.4 million or 25 cents in the year-ago quarter. The improvement was primarily attributable to solid net sales growth.

Non-GAAP net income was $124.9 million or $2.32 per share, up from $93.3 million or $1.77 in the prior-year quarter. The bottom line beat the Zacks Consensus Estimate by 13 cents.

In 2024, the company reported a GAAP net income of $4.6 million or 9 cents per share against a loss of $164.5 million or $3.30 in 2023. Non-GAAP net income was $434.1 million or $8.12 per share compared with $313.1 million or $6 in 2023.

HUBS’ Revenues

Quarterly revenues improved to $703.2 million from $581.9 million reported in the year-ago quarter. Steady multi-hub adoption was driving growth. The top line beat the Zacks Consensus Estimate by $30 million.

In 2024, the company reported total revenues of $2.6 billion up from $2.2 billion in 2023.

The introduction of new tools such as CRM development tools, sensitive-data support drove customer engagement in the premium market segment. Pricing model changes and AI innovation drove net sales in the lower end of the market. HubSpot’s conversational AI tool, Breeze Copilot, has been also gaining popularity. The company added 9,800 net new customers during the quarter, which increased the total customer count by 21% year over year to 248,000. 

Subscription revenues rose to $687.3 million from $570.2 million in the year-ago quarter. Average subscription revenues per customer declined 1% year over year on a constant currency basis to $11,300.

Professional services and other revenues totaled $15.9 million, up 36% year over year.

Other Details of HUBS

Gross profit in the quarter was $599.8 million, up from $494.5 million in the year-ago quarter. Operating loss, on a GAAP basis, was $10.8 million compared with $23.2 million in the year-earlier quarter. Non-GAAP operating income improved to $133.1 million from $99.3 million, with respective margins of 18.9% and 17.1%.

Cash Flow & Liquidity of HUBS

In the fourth quarter of 2024, the company generated $194.1 million in cash from operating activities compared with $104.3 million in the year-ago quarter. In 2024, the company generated $598.6 million of cash from operations compared with $351 million in 2023.

As of Dec. 31, 2024, HubSpot had $512.7 million in cash and cash equivalents with $55.6 million in other long-term liabilities compared with respective tallies of $388 million and $36.5 million in 2023.

HUBS’ Outlook

For the first quarter of 2025, the company expects revenues in the range of $697-$699 million. It expects non-GAAP operating income in the range of $98-$99 million. Non-GAAP earnings are predicted to be in the band of $1.74-$1.76 per share.

For 2025, revenues are anticipated to be between $2.985 billion and $2.995 billion, indicating 14% year-over-year growth. Non-GAAP operating income is expected to be within $543-$547 million, with a margin of 18%. Non-GAAP net income per share is likely to be in the range of $9.11-$9.19.

HUBS’ Zacks Rank & Stocks to Consider

HubSpot currently has a Zacks Rank #3 (Hold).

Keysight Technologies, Inc. KEYS has a Zacks Rank of 2 (Buy) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

In the last reported quarter, it delivered an earnings surprise of 5.10%. Keysight is expected to benefit from the growing proliferation of electronic content in vehicles, momentum in space and satellite applications, and rising adoption of driver-assistance systems globally.

InterDigital IDCC sports a Zacks Rank #1 at present. In the last reported quarter, it delivered an earnings surprise of 158.41%.

It is a pioneer in advanced mobile technologies that enable wireless communications and capabilities. The company designs and develops a wide range of advanced technology solutions used in digital cellular, wireless 3G, 4G and IEEE 802-related products and networks.

Zillow Group, Inc. ZG carries a Zacks Rank #2 at present. ZG delivered an earnings surprise of 7.07%, on average, in the trailing four quarters. The company is witnessing solid momentum in rental revenues, driven by growth in multi and single-family listings, which is a positive factor.

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