Rapid7 impresses with strong Q2 figures and solid future outlook

Cybersecurity specialist Rapid7 surpassed analysts' expectations in the second quarter of fiscal year 2024, increasing its revenue by 9.2% year-over-year to $208 million. For the next quarter, the company forecasts revenue of around $210 million, in line with analysts' expectations. Additionally, Rapid7 posted a Non-GAAP profit of $0.58 per share, a significant improvement from $0.18 per share in the same quarter of the previous year. "Rapid7 delivered solid results in the second quarter that met our expectations. We grew ARR (Annual Recurring Revenue) by 9% year-over-year to $816 million and further advanced our innovation leadership in the Security Operations Data Platform space," said Corey Thomas, Chairman and CEO of Rapid7. Since its founding in 2000, Rapid7 has focused on network over endpoint security, offering Software as a Service (SaaS) that helps companies assess their cybersecurity risks, swiftly detect breaches, and respond accordingly. The increasing demand for cybersecurity is a consequence of the growing trend to migrate business data and processes to the cloud and the rise in remote work. Over the past three years, Rapid7 increased its revenue from $126.4 million in the second quarter of 2021 to $208 million this quarter. Although the 9.2% year-over-year growth may disappoint some shareholders, the quarter-over-quarter revenue increase of $2.89 million marks a significant improvement from the $167,000 decline in the first quarter of fiscal year 2024 and indicates an acceleration in growth. For the upcoming quarter, the company expects year-over-year revenue growth of 5.6% to $210 million, representing a slowdown compared to the 13.1% growth of the same quarter in the previous year. Analysts expect revenue to grow by 6.3% over the next twelve months. Rapid7 reported a customer base of 11,484 companies at the end of the quarter, an increase of 22 customers from the previous quarter. This indicates a slight improvement from the prior quarter but falls below the typical growth of the previous year, possibly suggesting a revival in customer growth. Overall, Rapid7 delivered solid customer and revenue growth figures this quarter, slightly surpassing Wall Street forecasts. The stock rose by 2.9% to $34 immediately following the release of the results.