HubSpot’s third quarter results were overshadowed by a notable market selloff, despite revenue and adjusted earnings coming in above Wall Street expectations. Management highlighted that customer growth was driven by ongoing platform consolidation, multi-hub adoption, and momentum among larger enterprise clients. CEO Yamini Rangan pointed to “years of product investment, strong partner alignment and rising brand awareness amongst upmarket decision-makers” as key contributors to growth. The quarter also saw significant traction from embedded AI features, with customers leveraging new marketing, sales, and data tools to improve performance outcomes.
Is now the time to buy HUBS? Find out in our full research report (it’s free for active Edge members).
HubSpot (HUBS) Q3 CY2025 Highlights:
- Revenue: $809.5 million vs analyst estimates of $785.7 million (20.9% year-on-year growth, 3% beat)
- Adjusted EPS: $2.66 vs analyst estimates of $2.59 (2.9% beat)
- Adjusted Operating Income: $161.5 million vs analyst estimates of $157.3 million (19.9% margin, 2.6% beat)
- Revenue Guidance for Q4 CY2025 is $829 million at the midpoint, roughly in line with what analysts were expecting
- Management raised its full-year Adjusted EPS guidance to $9.61 at the midpoint, a 1.2% increase
- Operating Margin: 1.4%, up from -1.4% in the same quarter last year
- Customers: 278,880, up from 267,982 in the previous quarter
- Annual Recurring Revenue: $3.22 billion vs analyst estimates of $3.14 billion (22.9% year-on-year growth, 2.4% beat)
- Billings: $804 million at quarter end, up 18.1% year on year
- Market Capitalization: $20.69 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From HubSpot’s Q3 Earnings Call
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Samad Samana (Jefferies) questioned whether HubSpot can sustain 20%+ growth with its current SMB focus or if enterprise wins are needed. CEO Yamini Rangan stated that growth will depend on multi-hub expansion, upmarket momentum, and emerging drivers like AI and credits, noting, “We think we have plenty of TAM to be able to drive and grow faster than where we are.”
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Alex Zukin (Wolfe Research) asked about the magnitude of outperformance and whether billings deceleration signals any weakness. CFO Kathryn Bueker replied that billings growth is closely linked to revenue and that “mix shifts toward installed base selling” impacted billings, but reiterated confidence in leading indicators like net new ARR.
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Elizabeth Porter (Morgan Stanley) sought details on credit consumption and the pace at which customers exhaust included usage. CEO Rangan shared that credits are gaining traction, especially within customer agent and data hub, and that monetization will increase as adoption grows.
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Bradley Sills (Bank of America) inquired about average subscription revenue per customer (ASRPC) growth and upgrades. Bueker highlighted that larger deals, seat upgrades, and credits are offsetting headwinds from lower-priced starter tiers and robust new customer additions.
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Gabriela Borges (Goldman Sachs) asked about the quality of customer data and readiness for AI integration. Rangan explained that customers with full multi-hub adoption have higher data quality, and the new Data Hub is intended to further improve data hygiene and AI readiness.
Catalysts in Upcoming Quarters
In the next quarters, our analyst team will focus on (1) the monetization trajectory of new AI-powered agents and usage-based credits, (2) the pace of seat upgrades and multi-hub adoption across both SMB and upmarket segments, and (3) execution on integrating XFunnel and expanding AEO (Answer Engine Optimization) tools. The evolution of customer retention and net revenue retention will also be central to our assessment.
HubSpot currently trades at $396, down from $464.30 just before the earnings. Is the company at an inflection point that warrants a buy or sell? Find out in our full research report (it’s free for active Edge members).
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