On November 1, 2023, Rapid7 Inc (RPD, Financial), a leader in extended risk and threat detection, announced its financial results for the third quarter of 2023. The company reported an annualized recurring revenue (ARR) of $777 million, marking a 14% increase year-over-year. Total revenue for the quarter was $199 million, a 13% increase from the same period last year.
Financial Performance Highlights
Rapid7's products revenue stood at $190 million, up 14% year-over-year. However, the company reported a GAAP operating loss of $16 million, while the Non-GAAP operating income was $37 million. The company's CEO, Corey Thomas, attributed the increase in ARR to strong customer traction and momentum around their consolidated offerings for risk and threat management.
Income Statement Summary
The company reported a GAAP net loss of $76.6 million, significantly higher than the $28.7 million loss reported in the same period last year. However, the Non-GAAP net income stood at $33.9 million, a considerable increase from the $8.6 million reported in Q3 2022. The GAAP net loss per share was $1.25, while the Non-GAAP net income per share was $0.56.
Balance Sheet and Cash Flow Statement Summary
As of September 30, 2023, Rapid7 had cash and cash equivalents of $182.7 million. The net cash provided by operating activities was $3.7 million, a decrease from the $20.1 million reported in the same period last year. The company reported a negative free cash flow of $582,000.
Looking Ahead
For the fourth quarter and full-year 2023, Rapid7 anticipates annualized recurring revenue, revenue, non-GAAP income from operations, non-GAAP net income per share, and free cash flow to be within certain ranges. The company expects to achieve an ARR of $800 to $805 million, with a year-over-year growth of 12% to 13%. The projected revenue for the full year is between $773 and $775 million.
Recent Business Highlights
In recent developments, Rapid7 expanded its Managed Detection and Response (MDR) service to include multi-layered endpoint protection. The company also announced the opening of its Prague office, which will serve as the hub for technical talent and innovation. Additionally, Rapid7 issued $300.0 million aggregate principal amount of 1.25% convertible senior notes due 2029 in a private placement.
Explore the complete 8-K earnings release (here) from Rapid7 Inc for further details.
