HubSpot, Inc.

Q2 revenue was $930 million, up 20% year over year as reported and 17% in constant currency. Subscription revenue grew 20% year over year and services and other revenue rose 8%. Non-GAAP operating margin was 20% (20.3% in management remarks), up 3 points year over year; GAAP operating margin was 5% versus negative 3% a year ago. Non-GAAP net income was $165 million and non-GAAP EPS was $3.26, up 40% and 49% year over year, respectively; GAAP EPS was $0.86. Free cash flow was $168 million, or 18% of revenue, and cash and marketable securities were $1.4 billion. Customer count grew to over 306,000, up 14% year over year, with 7,000 net adds versus the prior expectation of 9,000 to 10,000. Average subscription revenue per customer was $11,800, up 4% as reported and 2% in constant currency. Net revenue retention was 102%, down 1 point year over year, while calculated billings were $930 million, up 14% as reported and 17% in constant currency. For Q3, HubSpot guided to total revenue of $924 million to $925 million, up 14% year over year as reported and 15% in constant currency, with non-GAAP operating income of $187 million to $188 million and non-GAAP EPS of $3.25 to $3.27. For full-year 2026, guidance is revenue of $3.678 billion to $3.686 billion, up 18% as reported and 16% in constant currency, with non-GAAP operating income of $762 million to $766 million and non-GAAP EPS of $13.23 to $13.31. The company expects quarterly net additions of about 5,000 to 6,000, NRR roughly flat year over year, CapEx at 5% to 6% of revenue, and free cash flow of about $750 million.

Yamini Rangan framed the quarter as a deliberate transition to an AI-first model, saying HubSpot is optimizing product, pricing and go-to-market around customers’ demand for proof of value and predictable costs. She emphasized that the company is willing to accept near-term friction to lower barriers to adoption, and pointed to accelerating AI usage, multi-hub wins and stronger upmarket deal momentum as validation of the strategy. Her tone was confident but explicit about the headwinds: longer sales cycles, larger buying committees, more C-suite/board scrutiny and budget optimization pressure. She repeatedly said HubSpot is meeting customers where they are, and she described the operating model changes as part of building long-term leverage and compounding growth.

Kate Bueker quantified the quarter’s mix of strength and pressure: revenue up 20% as reported, non-GAAP operating margin at 20%, non-GAAP EPS at $3.26, free cash flow at $168 million and cash plus marketable securities at $1.4 billion. She also highlighted that the company bought back more than $500 million of stock under its current program and that the board authorized an additional up to $1 billion repurchase authorization. On the outlook, she said the Q2 headwinds are expected to persist through the rest of the year, leading to a lower net add assumption of 5,000 to 6,000 per quarter and NRR roughly flat for 2026. She reaffirmed margin leverage plans, saying guidance implies 2 points of non-GAAP operating margin leverage in 2026 and 2 to 3 additional points in 2027, while CapEx is expected to stay at 5% to 6% of revenue and free cash flow around $750 million.

Analysts focused on whether anything beyond the stated pricing, trial and go-to-market changes disrupted the quarter, and management said the main issues were the deliberate AI changes plus a broader shift toward more cautious spending and longer approvals. Questions also centered on token costs, competitive noise from “AI native” vendors, and whether the current environment is temporary or the new normal. Management said customers want “value maxing,” not “token maxing,” and that HubSpot’s platform wins because it combines CRM context, governance and multiple agents in one place rather than creating agent sprawl. On funding AI adoption, Yamini said customers are either expanding after trials prove value or reallocating budgets by swapping seats for credits, and Kate added that downgrade pressure at renewal is weighing on NRR. When asked if pressure worsened through the quarter, Kate said it was not distinctly different from the start to the end of the quarter and continued into July.