HubSpot’s second quarter results for 2025 came in ahead of Wall Street’s expectations, but the market response was negative. Management attributed the quarter's performance to a combination of rapid AI-driven product adoption, strong seat upgrade momentum, and sustained growth in both its upmarket and downmarket segments. CEO Yamini Rangan cited the company's diversified customer acquisition channels as a key strength, noting that 90% of leads now come from non-blog sources, including social media, podcasts, and newsletters. The leadership team acknowledged ongoing shifts in buyer behavior, particularly the impact of declining organic search traffic and the rise of large language model (LLM)–driven discovery, as fundamental challenges that required proactive adaptation.
Is now the time to buy HUBS? Find out in our full research report (it’s free).
HubSpot (HUBS) Q2 CY2025 Highlights:
- Revenue: $760.9 million vs analyst estimates of $739.3 million (19.4% year-on-year growth, 2.9% beat)
- Adjusted EPS: $2.19 vs analyst estimates of $2.12 (3.1% beat)
- Adjusted Operating Income: $129.1 million vs analyst estimates of $124.9 million (17% margin, 3.4% beat)
- The company lifted its revenue guidance for the full year to $3.08 billion at the midpoint from $3.04 billion, a 1.4% increase
- Management raised its full-year Adjusted EPS guidance to $9.50 at the midpoint, a 1.8% increase
- Operating Margin: -3.2%, in line with the same quarter last year
- Customers: 267,982, up from 258,258 in the previous quarter
- Annual Recurring Revenue: $2.98 billion vs analyst estimates of $2.93 billion (19.4% year-on-year growth, 1.7% beat)
- Billings: $814.3 million at quarter end, up 25.6% year on year
- Market Capitalization: $22.33 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From HubSpot’s Q2 Earnings Call
- Samad Samana (Jefferies) asked how HubSpot is adapting INBOUND strategies in an Agentic AI world. CEO Yamini Rangan explained that the company diversified lead generation channels beyond blogs and is helping customers navigate the decline in organic search.
- Elizabeth Porter (Morgan Stanley) inquired about the personas adopting new core seats and future workflow opportunities. Rangan described expanding beyond traditional sales and service users to include admins and finance, with plans to add more AI-driven features for these roles.
- Bradley Sills (Bank of America) sought data on agent engagement levels. Rangan reported strong weekly usage and rising resolution rates, with some customers seeing 70–80% of support tickets resolved by AI agents.
- Arjun Bhatia (William Blair) asked about monetization trends for agent credits. Rangan said credit-based pricing for agents is still in early stages, but leading indicators suggest growing adoption and value realization, with broader monetization expected in 2026.
- Tyler Radke (Citi) questioned the drivers behind improved customer additions and average subscription revenue per customer. CFO Kate Bueker cited higher conversion rates in entry tiers, successful pricing promotions, and consistent momentum across professional and enterprise segments.
Catalysts in Upcoming Quarters
In the coming quarters, our analysts will focus on (1) the pace of adoption and monetization for HubSpot’s AI agents and credit-based pricing model, (2) execution on customer acquisition through diversified channels as organic search continues to decline, and (3) sustained upmarket momentum and partner-driven deal flow. We will also monitor the impact of additional AI feature launches and the company’s ability to convert new product usage into durable revenue streams.
HubSpot currently trades at $423.70, down from $490.51 just before the earnings. Is the company at an inflection point that warrants a buy or sell? The answer lies in our full research report (it’s free).
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