Software supply chain platform JFrog (NASDAQ:FROG) reported Q4 CY2025 results exceeding the market’s revenue expectations, with sales up 25.2% year on year to $145.3 million. Guidance for next quarter’s revenue was optimistic at $147 million at the midpoint, 2.4% above analysts’ estimates. Its non-GAAP profit of $0.22 per share was 16.2% above analysts’ consensus estimates.
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JFrog (FROG) Q4 CY2025 Highlights:
- Revenue: $145.3 million vs analyst estimates of $138.1 million (25.2% year-on-year growth, 5.2% beat)
- Adjusted EPS: $0.22 vs analyst estimates of $0.19 (16.2% beat)
- Adjusted Operating Income: $25.75 million vs analyst estimates of $21.82 million (17.7% margin, 18% beat)
- Revenue Guidance for Q1 CY2026 is $147 million at the midpoint, above analyst estimates of $143.6 million
- Adjusted EPS guidance for the upcoming financial year 2026 is $0.90 at the midpoint, beating analyst estimates by 1.8%
- Operating Margin: -14.7%, up from -21.9% in the same quarter last year
- Customers: 1,168 customers paying more than $100,000 annually
- Net Revenue Retention Rate: 119%, up from 118% in the previous quarter
- Annual Recurring Revenue: $600.6 million (25.5% year-on-year growth, beat)
- Billings: $178.5 million at quarter end, up 22.2% year on year
- Market Capitalization: $6.31 billion
StockStory’s Take
JFrog’s fourth-quarter performance was met with a positive market reaction, underpinned by robust demand for its software supply chain platform and notable expansion in both cloud and security segments. Management attributed this growth to increased adoption of JFrog Advanced Security and Curation, as well as deeper industry partnerships. CEO Shlomi Ben Haim emphasized that the company’s evolution into a unified platform for managing and securing binaries is resonating with enterprise customers, particularly as software creation accelerates in the era of artificial intelligence.
Looking ahead, JFrog’s guidance is driven by expectations of sustained growth in cloud and security offerings, alongside adoption of new AI and machine learning capabilities. Management believes that trends such as the proliferation of AI-generated code and the need for robust software governance will continue to increase demand for its platform. CFO Eduard Grabscheid noted that the company remains focused on disciplined investment and converting increased usage into larger annual commitments, while CEO Ben Haim stated JFrog is positioned to be the “system of record for all binaries and AI models.”
Key Insights from Management’s Remarks
Management highlighted that enterprise-focused go-to-market execution, security product momentum, and AI-driven demand were central to both outperformance in the quarter and optimistic forward guidance.
- Security product momentum: JFrog Advanced Security and Curation became key growth engines, with over 10% of annual recurring revenue (ARR) now attributed to these offerings. Management reported rapid adoption, especially following recent high-profile security incidents targeting the software supply chain, which reinforced customer urgency for end-to-end protection.
- Cloud adoption drives growth: Cloud revenues grew rapidly as customers migrated from on-premises solutions and increased annual commitments. Management cited strong partnerships with major cloud providers and a shift toward fit-for-purpose hybrid and multi-cloud architectures as supporting this trend.
- AI and binary proliferation: The rise of AI-generated code and use of coding agents has led to a surge in the volume of software binaries. JFrog’s platform is positioned as a foundational infrastructure to manage and secure this growing complexity, with CEO Ben Haim describing this trend as a “tsunami of binaries.”
- Strategic enterprise focus: The company intentionally consolidated lower-value customer accounts to focus on large enterprises, resulting in higher average spending per customer and multi-year commitments. Management noted that new enterprise customers are increasingly adopting security solutions from the outset.
- Expanding partnerships and integrations: Notable new integrations include serving as the secure model registry for NVIDIA’s AI Factory and partnering with Hugging Face, which supports both enterprise and open-source communities. These alliances are viewed as expanding JFrog’s reach and validating its platform as a system of record for AI artifacts.
Drivers of Future Performance
JFrog’s outlook is primarily anchored by continued momentum in security and AI-enabled solutions, as well as strategic investments to support a growing enterprise customer base.
- Security adoption as a growth lever: Management expects ongoing software supply chain threats to sustain demand for its security suite, with more existing and new enterprise customers adopting these offerings. JFrog Curation and Advanced Security are seen as critical for customers seeking governance before software enters production.
- AI-fueled binary growth: The increasing use of AI coding agents is expected to accelerate the creation of software binaries, driving higher consumption and storage requirements. JFrog’s pricing model, based on consumption and capacity, positions the company to benefit as enterprise customers commit to managing larger software artifact volumes.
- Investment discipline and currency headwinds: While investing in platform innovation and cloud infrastructure, management remains committed to expense control. The weakening U.S. dollar is expected to create cost headwinds, but JFrog’s global hedging program and operational discipline are designed to maintain profitability targets.
Catalysts in Upcoming Quarters
In upcoming quarters, the StockStory team will monitor (1) the pace of security suite adoption among both existing and new enterprise customers, (2) the conversion rate of increased binary and model creation—especially from AI agents—into higher annual commitments, and (3) the impact of new partnerships, such as those with NVIDIA and Hugging Face, on customer acquisition and platform usage. Additional attention will be given to JFrog’s execution on disciplined investment and its ability to manage potential currency headwinds.
JFrog currently trades at $55.14, up from $53.30 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).
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