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BOSTON - Semrush Holdings , Inc. (NYSE:SEMR), a leading online visibility management SaaS platform, reported second quarter earnings that beat revenue expectations but missed on EPS, while issuing disappointing guidance that sent shares plunging 16%.
The company posted revenue of $108.9 million for the second quarter, slightly above analyst estimates of $108.84 million and up 20% YoY. However, Semrush reported a loss of -$0.04 per share, falling $0.12 short of the $0.08 EPS analysts had expected. The company’s shares tumbled following the release as investors reacted to weaker-than-expected forward guidance.
For the third quarter, Semrush expects revenue between $111.1 million and $112.1 million, below the consensus estimate of $115 million. The company also lowered its full-year revenue outlook to $443-446 million, below analyst expectations of $450.1 million, citing "softer demand at the lower end of the market, impacted by an increase in paid-search cost per click."
"We posted strong revenue growth in the second quarter and were especially pleased by the accelerated adoption of our AI and Enterprise products," said Bill Wagner, CEO. "We are very excited about our leadership position in the market and our long-term growth opportunities."
Despite the earnings miss and reduced guidance, Semrush announced a $150 million share repurchase program, which has no time limit and can be suspended or modified at any time.
The company reported that customers paying more than $50,000 annually increased 83% YoY, while those paying more than $10,000 annually grew by 35%. Semrush ended the quarter with approximately 116,000 paying customers and achieved a dollar-based net revenue retention rate of 105%.
"Looking ahead, I am energized about our ability to drive durable growth, profitability, and strong cash flow," said Brian Mulroy, CFO. "Our share repurchase program demonstrates our strong conviction in the business."
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