Q2 2025 Smartsheet Inc Earnings Call Transcript
Key Points
- Smartsheet Inc (SMAR) reported a strong Q2 with annualized recurring revenue (ARR) reaching $1.093 billion, up 17% year over year.
- The company saw significant enterprise growth, with 75 customers expanding their ARR by more than $100,000 and three transactions exceeding $1 million.
- Smartsheet Inc (SMAR) launched a new pricing and packaging model, which has led to high engagement and the addition of many new customers.
- The company is making good progress on the modernization of its platform and plans to showcase new features at the upcoming ENGAGE Seattle conference.
- Generative AI tools have shown positive early results, with nearly 50% sequential growth in user adoption and significant time savings reported by customers.
- The full churn rate increased slightly to around 4.5%, primarily due to elevated churn rates in smaller customer segments.
- Despite strong performance, Smartsheet Inc (SMAR) maintained its FY25 revenue guidance, indicating a cautious outlook.
- The company expects its dollar-based net retention rate (NRR) to track down, consistent with overall ARR guidance.
- There was a slight decline in services revenue expectations for the full year due to a higher percentage of services being delivered by partners.
- Smartsheet Inc (SMAR) did not provide specific details on the impact of the new pricing model on like-for-like customer spend, indicating uncertainty in the early stages of its implementation.
(audio in progress) Please note that this call is being recorded.
(Operator Instructions) I will now turn the call over to Mr. Aaron Turner, Head of Investor Relations. You may begin your conference.
Great. Thank you. Good afternoon, and welcome, everyone, to Smartsheet's second quarter of fiscal year 2025 earnings call. We will be discussing the results announced in our press release issued after the market closed today. With me today are Smartsheet CEO, Mark Mader; and our CFO, Pete Godbole.
Today's call is being webcast and will also be available for replay on our Investor Relations website at investors.smartsheet.com. There's a slide presentation that accompanies today's prepared remarks, which can be viewed in the Events section of our Investor Relations website.
During this call, we will make forward-looking statements within the meaning of the federal securities laws. We have based these forward-looking statements largely on our current expectations and projections
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