N-able, Inc.

Second-quarter ARR was $544 million, up 6% year over year in constant currency. Total revenue was $138 million, up approximately 6% reported and 5% constant currency; subscription revenue was $137 million, also up approximately 6% reported and 5% constant currency. Gross margin was 80% versus 82% in the same period of 2025. Adjusted EBITDA was $40 million, or a 29% margin; non-GAAP EPS was $0.10; and unlevered free cash flow was $23 million. For the full year 2026, N-able guided to revenue of $539 million to $542 million, ARR of $562 million to $565 million, adjusted EBITDA of $158 million to $161 million, and unlevered free cash flow of $116 million to $120 million. Third-quarter revenue guidance was $134.5 million to $135.5 million, with adjusted EBITDA of $41 million to $42 million. Management said Q2 renewal rates in the biggest cohort moved from the higher 80s to the mid-80s and that similar renewal rates are assumed for the rest of the year.

John Pagliuca framed the quarter around a long-term cybersecurity and AI opportunity, saying AI is accelerating cyber risk and making N-able’s endpoint, data protection, and security operations portfolio more relevant. He was candid that 2026 top-line guidance is being reduced because of a CRO transition and shifting UEM/EDR dynamics, but said the company is acting decisively with a new channel-focused leader, a 6% headcount reduction, and updated product road maps. His tone was confident but pragmatic: near-term pressure is real, but he repeatedly emphasized that the company is positioning for stronger growth in 2027 and beyond.

Tim O’Brien said the business remains highly profitable despite the guide reset, pointing to a full-year adjusted EBITDA margin outlook of about 29% to 30% at the midpoint. He highlighted Q2 gross margin of 80%, adjusted EBITDA of $40 million, and unlevered free cash flow of $23 million, plus cash of about $116 million and net leverage of approximately 1.8x. He also said N-able added a delayed draw term loan facility of up to $75 million, has $45 million of share repurchase authorization left, and expects the workforce reduction to cut annualized operating expenses by about $11 million to $13 million while creating $4 million to $6 million of restructuring charges in the second half.

Analysts focused on why renewal rates weakened, whether customers are leaving or just repricing, and whether the softness reflects competition or a longer buying pause. Management said the issue is concentrated in UEM and EDR, with pricing pressure, quantity reductions at MSPs, and some competitive displacement in EDR; John Pagliuca specifically said some customers may be moving to alternative EDR providers, while UEM appears more like pricing sensitivity than a major share shift. Questions also probed the role of AI in buying behavior and the MSP versus VAR mix; management said MSPs are rethinking workflow and AI strategy, while the company is leaning more into mid-market/channel motions through its new CRO.