HubSpot (HUBS) Reports Q3: Everything You Need To Know Ahead Of Earnings

Radek Strnad /
2022/11/01 4:06 am EDT

Sales and marketing software maker HubSpot (NYSE:HUBS) will be reporting earnings tomorrow after market hours. Here's what to look for.

Last quarter HubSpot reported revenues of $421.7 million, up 35.7% year on year, beating analyst revenue expectations by 3.02%. Despite the solid topline results, it was a weak quarter for the company, with guidance for both the next quarter and full year missing analysts' expectations. The company added 7,176 customers to a total of 150,865.

Is HubSpot buy or sell heading into the earnings? Read our full analysis here, it's free.

This quarter analysts are expecting HubSpot's revenue to grow 25.6% year on year to $426 million, slowing down from the 48.5% year-over-year increase in revenue the company had recorded in the same quarter last year. Adjusted earnings are expected to come in at $0.51 per share.

HubSpot Total Revenue

The analysts covering the company have been growing increasingly bearish about the business heading into the earnings, with revenue estimates seeing four downward revisions over the last thirty days. The company has a history of exceeding Wall St's expectations, beating revenue estimates every single time over the past two years on average by 4.99%.

Looking at HubSpot's peers in the sales and marketing software segment, some of them have already reported Q3 earnings results, giving us a hint of what we can expect. Zendesk delivered top-line growth of 20.1% year on year, missing analyst estimates by 2% and UserTesting reported revenues up 27.8% year on year, exceeding estimates by 2.91%. Zendesk traded flat on the results, and UserTesting was up 91.7% on acquisition announcement at $7.5 per share. Read our full analysis of Zendesk's results here and UserTesting's results here.

Investors in the software segment have had steady hands going into the earnings, with the stocks up on average 1.67% over the last month. HubSpot is up 4.38% during the same time, and is heading into the earnings with analyst price target of $396.60, compared to share price of $297.00.

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The author has no position in any of the stocks mentioned.