Tenable Q1 2025 presentation slides: 11% revenue growth amid expanding margins

Introduction & Market Context

Tenable Holdings Inc . (NASDAQ:TENB), a leader in exposure management and vulnerability solutions, delivered its Q1 2025 corporate presentation highlighting strong financial performance despite subsequent market skepticism. The cybersecurity firm positioned itself as answering a critical question for organizations: "Are we exposed and are we at risk?"

While Tenable’s presentation showcased impressive financial metrics and strategic initiatives, the company’s stock fell 10.21% in aftermarket trading following its earnings announcement, despite beating analyst expectations. This disconnect between financial performance and market reaction suggests investors may have concerns about future growth prospects, particularly given management’s caution regarding U.S. public sector uncertainties.

Quarterly Performance Highlights

Tenable reported Q1 2025 revenue of $239.1 million, representing 11% year-over-year growth. The company maintained its strong recurring revenue model, with 96% of total revenue coming from recurring sources. Gross margins remained healthy at 82%, while operating margins expanded to 20%, up from 17% in the same period last year.

As shown in the following chart of revenue and calculated current billings growth:

Particularly noteworthy was Tenable’s record unlevered free cash flow of $86.8 million in Q1 2025, representing a substantial 36% margin, up significantly from 25% in Q1 2024. This cash flow performance demonstrates the company’s improving operational efficiency and financial discipline.

The company’s revenue remains well-diversified geographically, with 63% coming from the Americas, 26% from EMEA, and 11% from APAC regions in Q1 2025, providing some insulation from regional economic fluctuations.

Strategic Initiatives

Tenable’s presentation emphasized its leadership position in the vulnerability management space while highlighting its expansion into the broader exposure management market. The company has been recognized as a leader by multiple analyst firms, including Forrester, IDC, and Frost & Sullivan.

The company’s competitive positioning in the market is illustrated in this analyst recognition chart:

A key strategic focus for Tenable is expanding its cloud security capabilities. The company has developed a comprehensive Cloud Security (CNAPP) offering that includes Kubernetes security, threat detection, AI security, identity security, and several other components aimed at helping customers understand and mitigate their cloud risk exposure.

Tenable estimates its total addressable market at $33 billion with an 18% CAGR, broken down across cloud security ($16B), vulnerability management ($5B), and specialty assets ($12B), as shown in this market opportunity visualization:

Detailed Financial Analysis

Tenable’s financial strategy focuses on landing and expanding high-value customer relationships. The company reported 2,042 customers with annual contract values exceeding $100,000 as of Q1 2025, representing steady growth from 1,717 such customers in Q1 2024.

The company’s success in acquiring and growing high-value customers is demonstrated in this chart:

This focus on enterprise customers appears to be paying dividends in terms of operational efficiency. Tenable has steadily improved its non-GAAP operating margins from 10% in 2022 to 20% in Q1 2025, while unlevered free cash flow margins have expanded from 19% in 2022 to an impressive 36% in Q1 2025.

The company’s margin expansion trajectory is illustrated in the following chart:

Tenable’s business model leverages Nessus, its popular vulnerability assessment tool, as an on-ramp to its broader enterprise platform. This land-and-expand strategy allows the company to efficiently acquire new customers and then grow relationships over time.

Forward-Looking Statements

Looking ahead, Tenable provided guidance for Q2 and full-year 2025. For Q2, the company expects revenue between $241.0 million and $243.0 million, with non-GAAP earnings per share between $0.29 and $0.31.

For the full year 2025, Tenable forecasts:

• Revenue of $970.0 million to $980.0 million
• Calculated current billings of $1.025 billion to $1.045 billion
• Non-GAAP operating income of $205.0 million to $215.0 million
• Non-GAAP earnings per share of $1.44 to $1.52
• Unlevered free cash flow of $265.0 million to $275.0 million

The company’s detailed financial outlook is presented in this guidance table:

During the earnings call, management expressed caution regarding uncertainties in the U.S. public sector, which could impact growth. This cautious outlook, despite strong Q1 results, may have contributed to the negative market reaction following the earnings announcement.

Co-CEOs Steve Vince and Mark Thurman emphasized Tenable’s strategic focus on building "the most intelligent, scalable, and complete exposure management solution on the market," with particular emphasis on cloud solutions as "a critical pillar of exposure management."

As cybersecurity threats continue to evolve and organizations accelerate their cloud adoption, Tenable appears well-positioned to capitalize on growing demand for comprehensive exposure management solutions, though investors will be watching closely for signs that the company can maintain its growth trajectory amid potential public sector headwinds.

Full presentation:

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