ON24, Inc.

Q3 total revenue was $34.6 million, with total subscription and other platform revenue of $32 million and professional services revenue of $2 million. Core platform revenue, including services, was $34 million, and total ARR ended the quarter at $124.5 million, with core platform ARR at $122.4 million. Gross margin was 76%; operating loss was $400,000, net income was $1.2 million or $0.03 per share, and free cash flow was positive $2.7 million excluding certain items, or $2.2 million including them. For Q4, ON24 guided total revenue to $33.9 million to $34.5 million, gross margin to 76% to 77%, non-GAAP EPS to $0.01 to $0.02, and core ARR to range from down 1% to up 1% versus Q3, with adjusted EBITDA expected to be positive. For full-year 2025, it guided total revenue to $138.6 million to $139.2 million, gross margin to 76% to 77%, non-GAAP EPS to $0.05 to $0.06, and positive free cash flow in 2025.

Sharat Sharan framed the quarter as operationally strong on P&L despite ARR softness, saying revenue, profitability, gross margin, and free cash flow were all above the high end of guidance. He emphasized that AI products, win-backs in regulated industries, and the LinkedIn partnership are central to driving better ARR performance in Q4 and setting up a stronger 2026. His tone was upbeat and strategic, but he was also candid about softer new growth bookings and some life sciences pressure.

Steve Vattuone focused on the numbers and the operating model. He highlighted Q3 revenue of $34.6 million, 76% gross margin, $1.2 million of net income, and seventh straight quarter of positive free cash flow, plus approximately $175 million of cash and investments at quarter-end. He also said sales and marketing expense fell to $14.4 million, or 42% of revenue, from $15.9 million a year ago, and reiterated a plan to take S&M down to the mid-30s as a percentage of revenue in 12 months and the low-30s in two years while keeping positive adjusted EBITDA and free cash flow.

Analysts focused on the ARR miss, the $6.7 million of deals that slipped from Q3 into Q4, and whether that was a one-off or reflected broader softness. Management said the issue was mainly slower urgency in new business and some pressure in pharma/life sciences, but noted that 60% to 65% of the slipped deals had already closed in Q4 and that Q4 should show meaningful ARR improvement. Questions also centered on AI monetization and the LinkedIn deal; management said AI is already helping retention and expansion, close to 40% to 50% of new deals include AI, and that LinkedIn should become monetizable in phases, with lookalike audiences expected by February and a stronger impact by the end of Q1.