On August 6, 2024, Rapid7 Inc (RPD, Financial) released its 8-K filing detailing its financial results for the second quarter of 2024. Founded in 2000, Rapid7 is a cybersecurity company that began providing vulnerability management solutions. It has since expanded its portfolio to include extended detection and response, security information and event management, cloud security, threat intelligence, application security, and security orchestration, automation, and response. The Boston-based company went public in 2015.
Performance Overview
Rapid7 Inc (RPD, Financial) reported total revenue of $208 million for Q2 2024, reflecting a 9% year-over-year increase, surpassing the analyst estimate of $203.66 million. The company's product subscriptions revenue grew by 10% year-over-year to $200 million. The annualized recurring revenue (ARR) also saw a 9% increase, reaching $816 million.
GAAP operating income for the quarter was $7 million, while non-GAAP operating income stood at $39 million. Net cash provided by operating activities was $33 million, and free cash flow amounted to $29 million.
Key Financial Metrics
| Metric | Q2 2024 | Q2 2023 | % Change |
|---|---|---|---|
| Total Revenue | $207,991 | $190,422 | 9% |
| Product Subscriptions Revenue | $200,067 | $181,701 | 10% |
| GAAP Operating Income | $6,880 | $(51,659) | N/A |
| Non-GAAP Operating Income | $39,276 | $12,957 | 203% |
| GAAP Net Income | $8,195 | $(66,782) | N/A |
| Non-GAAP Net Income | $41,646 | $11,520 | 261% |
| Free Cash Flow | $29,205 | $25,581 | 14% |
Company Achievements and Challenges
Rapid7 Inc (RPD, Financial) has made significant strides in enhancing its product offerings and expanding its market presence. The introduction of the Command Platform is a notable achievement, aimed at providing comprehensive visibility to risks across hybrid attack surfaces. This aligns with the company's strategic vision to help customers integrate critical security data to close security gaps and prevent attacks.
"Rapid7 delivered solid second quarter results in line with our expectations, growing ARR by 9% year-over-year to $816 million, and continuing to innovate to bring customers the strongest security operations data platform," said Corey Thomas, Chairman and CEO of Rapid7.
However, the company faces challenges such as maintaining its growth momentum and managing operational costs. The slight decline in professional services revenue by 9% year-over-year indicates potential areas for improvement.
Financial Statements Highlights
From the balance sheet, Rapid7 Inc (RPD, Financial) reported total assets of $1.53 billion as of June 30, 2024, compared to $1.51 billion at the end of 2023. The company's cash and cash equivalents increased to $237 million from $214 million. On the liabilities side, total liabilities decreased to $1.58 billion from $1.62 billion, primarily due to a reduction in convertible senior notes.
In the income statement, the company reported a GAAP gross profit of $147 million, with a GAAP gross margin of 71%. Non-GAAP gross profit was $154 million, maintaining a non-GAAP gross margin of 74%. The significant improvement in GAAP net income to $8.2 million from a loss of $66.8 million in the previous year highlights the company's enhanced profitability.
Conclusion
Rapid7 Inc (RPD, Financial) has demonstrated robust financial performance in Q2 2024, with notable revenue growth and improved profitability. The company's strategic initiatives and product innovations position it well in the competitive cybersecurity market. However, it must continue to address operational challenges to sustain its growth trajectory.
For more detailed insights, visit the 8-K filing.
Explore the complete 8-K earnings release (here) from Rapid7 Inc for further details.
