SunRush at Canaccord Conference: AI Drives Growth Strategy

On Tuesday, 12 August 2025, SunRush Holdings (NYSE:SEMR) presented at Canaccord Genuity’s 45th Annual Growth Conference, highlighting its strategic focus on AI and enterprise growth. While the company reported strong financial performance and an optimistic outlook, challenges in AI optimization and market competition were acknowledged.

Key Takeaways

• SunRush reported $435 million in annual recurring revenue (ARR) with a 20% year-over-year revenue increase.
• A new $150 million share repurchase program reflects confidence in future growth.
• AI and enterprise solutions are central to SunRush’s strategic expansion.
• The company aims to grow its AI product ARR to over $50 million by 2025.
• New CEO Bill Wagner is prioritizing AI market opportunities.

Financial Results

• Annual Recurring Revenue (ARR): $435 million, with 100% SaaS recurring revenue.
• Quarterly Revenue: $109 million, marking a 20% increase from the previous year.
• Operating Margin: 11% non-GAAP.
• Customer Base: 116,000 paying customers, including 9,000 enterprise customers contributing 20% of ARR.
• Share Repurchase: A $150 million program has been authorized.
• Cash Reserves: SunRush holds $260 million in cash.

Operational Updates

• Customer Reach: Serves a diverse range of businesses, from 40% of Fortune 500 companies to local enterprises.
• Enterprise Growth: Focused on a platform approach, replacing point solutions with comprehensive offerings.
• Product Development: Launched an AI Optimization (AIO) product in June, achieving over $1 million in ARR in three weeks.
• Sales Strategy: Increased investment in sales and demand generation for enterprise clients.

Future Outlook

• AI Expansion: Significant growth expected from AI optimization, with new functionalities in development.
• Enterprise Portfolio: Plans to expand product offerings to capture a larger share of enterprise spending.
• Market Dynamics: AI search is viewed as expanding market opportunities rather than disrupting existing search paradigms.
• Leadership Vision: CEO Bill Wagner aims to accelerate growth, particularly in the AI sector.

Q&A Highlights

• Capital Allocation: Balancing organic growth with share repurchases and strategic M&A.
• M&A Strategy: Targeting acquisitions that enhance the digital marketing platform.
• Competitive Edge: Data assets provide a significant competitive advantage, particularly in AI insights.
• AI Search Impact: AI search is anticipated to increase the volume of search interactions.

In conclusion, SunRush’s participation in Canaccord Genuity’s conference underscored its commitment to leveraging AI for growth. For a deeper understanding, readers are encouraged to review the full transcript below.

Full transcript - Canaccord Genuity’s 45th Annual Growth Conference:

DJ Hines, Senior Software Analyst, Canaccord: Ready. Alright. I’m DJ Hines. I’m the senior software analyst here at Canaccord. Thanks everyone for being here.

This is the forty fifth year that Canaccord hosted this conference. We couldn’t do it without the participation of the companies who come and bring all the great content, the investors that show up and support us. So thank you. With that, I think we’ll get right into it. Delighted to have the SunRush team here.

We have Eugene Levin, who’s the President and Chief Strategy Officer Brian Mulroy is the CFO. Maybe just to set the stage, Eugene, you could talk a little bit about the business, the problems you solve, kind of what the products are, the customers, that sort of stuff, just to give everyone who may not have heard the story before an intro to SEMrush.

Eugene Levin, President and Chief Strategy Officer, SunRush: So we solve one of the most fundamental problems for every business, which is how to be visible and how to make sure that your potential customers will know about products and services that you provide. And today, consumers spend a lot of time in different places all over the Internet. They use variety of platforms. They search for things in Google. They check maps and reviews for local businesses.

They read media. They read social media. They watch YouTube videos. And of course, now they also ask shared GPT and other AI assistants what they need to do and what to buy in different situations. And so SEMrush helps businesses to be visible in all those places.

And we help different companies to outcompete their competition and rank above them and get more eyeballs, more attention from customers. Yes.

DJ Hines, Senior Software Analyst, Canaccord: For anyone who’s been paying attention to software throughout earnings this cycle, it’s clearly a hot topic with everything that’s happening in search and AI driven search. So this is a timely conversation. It’ll be good to unpack some of the details. Maybe you could talk a little bit about kind of your customer mix today and who your typical user is.

Eugene Levin, President and Chief Strategy Officer, SunRush: So we sell to all kind of customers, companies of all sizes from roughly 40% of Fortune 500 companies to smallest businesses like plumbers, propaneters, local service businesses, manufacturers and so on. So there is no any kind of concentration. Any business that would benefit from getting customers through online channels, can use SEMrush to their advantage.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Let’s talk a little bit about Q2 results. What you guys saw in the quarter, kind of what the takeaway should be for investors?

Brian Mulroy, CFO, SunRush: Tore, yes, we reported a strong quarter, dollars $435,000,000 of annual recurring revenue. Our business is 100 SaaS recurring revenue. We achieved about $109,000,000 of revenue in the quarter, which is up 20% year over year and 11% non GAAP operating margin. As of the end of the second quarter, we have 116,000 paying customers. As Eugene mentioned, we have fairly wide appeal.

We’re with in 150 countries and our products are used by the biggest Fortune 500 brands in the world, all the way down to a local pizza shop or plumber and everything in between. So very strong results for the quarter. We’re building out an enterprise go to market and product portfolio, which performed very well in the second quarter and that we’ll get into a little bit.

DJ Hines, Senior Software Analyst, Canaccord: Yes, maybe that’s a good segue to just talk a little bit about it now. I mean, I know enterprises, you’re seeing a lot of momentum there. Sure. Just talk about kind of the health of that customer base, some of the initiatives that you guys have underway and what you’re seeing generally in enterprise.

Brian Mulroy, CFO, SunRush: Definitely. So yes, out of the 116,000 paying customers, 9,000 of them are what we refer to as enterprise, our enterprise segment. That’s any business that has more than 500 employees. They represent today about 20% of our annual recurring revenue. But over the last two years, we’ve made an effort to build out a more robust enterprise portfolio that replaces point solutions and establishes a platform across all the digital marketing needs inside these enterprises, and in particular, the new AI or LLM oriented needs that businesses have today.

We’re this portfolio, on average, sells for over $100,000 in annual recurring revenue. And we’re just beginning our journey to convert a portion of those 9,000, but believe all 9,000 plus other enterprises that have similar digital marketing needs will have a need for that portfolio. So we’re investing in go to market. We’re investing in product and demand generation. And as of now, that’s one of the fastest growing parts of the business.

DJ Hines, Senior Software Analyst, Canaccord: Yes. How do you balance I mean, I think historically, SunRush has been largely a product led growth story. Now you have kind of the new direct sales efforts. How do you kind of balance the two and think about contribution of the business going forward?

Eugene Levin, President and Chief Strategy Officer, SunRush: So you’re right. Historically, we were a PLG company, but quality of the product was so exceptional that a lot of large corporations used it anyway even if they lacked certain enterprise first features, like maybe user management or limit assignments, they still benefited tremendously from high quality data, and they were buying our products already. And so what changed is that a couple of years ago, we said, okay, now this seems like an interesting opportunity for us, so why don’t we go and build all those features that large companies are missing in our PLG product, such as customizable dashboards, more refined workflows, especially AI powered workflows, and of course, integration of their own data sources and custom metrics and data lake. So we added all those features to our enterprise platform and the reception have been exceptional, very quickly became our fastest growing product ever. We scaled to, let’s say, dollars 9,000,000 by the end of the first six months, and now it’s at two sixty, right, customers?

Brian Mulroy, CFO, SunRush: Two sixty customers and $16,000,000 of annual recurring revenue. Just one product.

Eugene Levin, President and Chief Strategy Officer, SunRush: Right. And so that have been fantastic journey for us. But the reason it was so successful is because we already had a lot of those customers. It was like fishing in our own pond where we already have all the people who are interested and have been telling us that they want this kind of product. And I think that’s a big driver of the early success.

And of course, this year, we’re expanding portfolio of products. So we have launched the optimization product that is also already growing really well. And later this year, we’re launching our website intelligence product.

DJ Hines, Senior Software Analyst, Canaccord: Yeah. Maybe we could talk a little bit about kind of the role of the enterprise sales force. I mean, you talked about you kind of already have a lot of these customers. Is that effort aimed back at the base? Is it aimed at new?

And kind of how are you investing behind the enterprise build out?

Brian Mulroy, CFO, SunRush: Yes, it’s both. I mean we’ve had a sales organization for a while. So even through the years where we had a product led growth and a majority of our customers were coming through our website and just paying with a credit card and subscribing without any human interaction. We always had a sales organization to cater towards our more sophisticated customers. So over the years, as we’ve now started to build out a portfolio that is a digital marketing platform that these enterprise have a strong need for.

We’re investing in that sales organization, investing in demand generation capabilities and selling resources that can establish a trusted adviser status in partnership with these larger brands. It’s been going really well. So we’re already up to, as Eugene said, dollars 16,000,000 in annual recurring revenue in just a year with our first enterprise SEO products. We launched Enterprise AIO, which is an AI optimization product in June. That’s already up over $1,000,000 in annual recurring revenue in just three weeks.

And then just today, launched our new website or site intelligence products. So we already have three products that are enterprise specific and bolstering the efforts for this enterprise sales organization.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Yes, that’s great. Maybe we could zoom out. I think this is a question that’s on every investor’s mind, just what’s happening in search broadly, right? How are the ways that people discover products changing?

What’s the impact that Gen AI has on this? Is Gen AI a tailwind or a headwind to the business?

Eugene Levin, President and Chief Strategy Officer, SunRush: I think the pace of change is exceptional, arguably like nothing we’ve ever seen. We went just within two years from people not using certain technology at all to people using it quite a lot, especially when they need to make big decisions. Let’s say we see, for example, when people are making purchase, like, let’s say, TV, so fairly large purchase for an average household, they increasingly ask AI assistants, ChatGPT, or Google’s new AI mode for advice. And they increasingly follow the advice that they get from those systems. So I think AI search and AI systems, they become integral part of the customer journey moving forward.

And brands need to really hear about how their products and services are presented in the results of this AI search, what AI thinks about them. And that creates a new discipline. There are different ways to call it. We call it AI optimization or AI search optimization. I don’t think there is 100% consensus in industry players about how to call it.

But I think the idea is very simple. You want to influence AI systems to effectively recommend your products and services when they’re the best products and services for a particular customer in a particular situation. And you may wanna make sure that they have accurate representation of what your product does and what it doesn’t do. And it has a lot of similarities with search optimization, but it also has a lot of differences. With traditional search engine optimization, you focus more on technical components of your website or content in your own website, and the goal is to drive clicks to your website.

However, with AI search optimization, the idea is that you need to influence overall narrative because unlike traditional search where your content ranks or doesn’t rank, AI looks at hundreds of pieces of content to answer particular questions. So you need, you know, to effectively embed certain messages into all those 100 pieces of content so AI gets consistent narrative around your products and services. And that’s a bit of a different discipline. And that’s what we can see when we offer new products and they grow really fast. It’s in high demand.

Brands understand an importance of being visible in AI search, and they take action. That said, I think we’re in the very early days of this new industry taking shapes a shape, both from product portfolio point of view, which we expand in constantly, and also customer maturity where people are still learning how to do this and how to participate in this new environment. And we expect a lot of growth. We’re super optimistic. And I think early traction that we’re having with our own AI optimization products is fantastic and real proof of how big this is going to be.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Maybe that’s a good segue to kind of dive into some of your own AI solutions today. Maybe you could talk a little bit about kind of your AI toolkit and what those products are doing for customers.

Eugene Levin, President and Chief Strategy Officer, SunRush: So AI toolkit is primarily a strategy and measurement product. So it allows you to track your visibility for key prompts related to your products and services in several different LLMs and different AI search engines. And on top of showing you visibility, it also shows sentiment because sometimes you may be visible but not in the right way. Maybe information is off. Maybe it does not actually recommend your product.

It tells customers to stay away from your offering. Like, for example, we’ve seen a lot of insurance companies where they’re visible when people ask questions, but they’re visible in a way where AI says, You know, they have a lot of high percentage of claims that were not approved. Maybe you stay away from this insurance company. So we see a lot of that. And so businesses need to pay attention not only are they mentioned or not, but do they control the narrative?

Is it what they want AI to think about them? And then also product shows the sources. So for each of the prompt, it shows what influenced the answer to a particular question. So if brand is not satisfied with how the question was answered, they can go and work with the source. And sometimes it requires techniques common in affiliate marketing or influencer marketing or blogger outreach or digital PR, so a variety of techniques that brands can use to influence the narrative.

And so SEMrush’s role is point them in the right direction so they can deploy all those resources to their benefit. Because if you just try to do everything, there will be not enough resources, so you need to prioritize. So AI toolkit primarily allows people to measure and benchmark themselves against competition. It shows what are the important questions to focus on, where are their images favorable, where it is not favorable, and where they need to go and who they need to work with to achieve their strategic goals.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Yes. It’s super interesting. Maybe we could talk a little bit about competitive differentiation and kind of what sets SEMrush apart. I think a lot of it is driven by kind of the data asset, right?

So talk a little bit about that, kind of the key sources of data for you guys and what differentiates you in the market.

Eugene Levin, President and Chief Strategy Officer, SunRush: So data is a huge differentiator for us. It’s also a big moat around the business, which makes it very hard for other people to compete with us. And I think AI is a great example of how our data becomes a real differentiator. If you think about monitoring visibility in AI search, you first need to think what are the real life examples, real life prompts that people have, what actual questions they ask. You can generate a lot of relevant questions for the business, but they might be not the ones that real people actually asking.

And so SEMrush has unique panel data where we have real life prompts from a lot of contributors. And this helps us to understand what’s actually going on. There are certain questions that people ask from AI, for example, that they don’t ask in Google or other places. And there are certain questions that are more common for search engines and not very common for AI search. And so our data helps us to focus on things that matter, things that drive the financial outcomes for our customers.

And that’s just one of the examples of the data assets that help us to gain advantage.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Maybe we could pivot over and talk a little bit about the financials of the business. You guys initiated a share repurchase program recently. Just talk a little bit about kind of philosophy around capital allocation and how you’re trying to put the balance sheet to work?

Brian Mulroy, CFO, SunRush: Sure. Yes, we just authorized $150,000,000 in share repurchase. We have $260,000,000 in cash on the balance sheet. So we’re in a strong position and have flexibility to invest organically in a business, and we’re doing that. We’re investing in our enterprise go to market, our product portfolio for sure in AI and continuing to navigate through this market shift and investing in a number of other areas of the business organically.

We’re also seeing an opportunity now where everyone’s questioning, is AI a headwind or a tailwind? And we have strong conviction that it is a tailwind, and we’re investing in the product portfolio that’s allowing us to navigate through that. The early proof points are we launched our first AI product in March. That’s already up over $5,000,000 in annual recurring revenue. That’s the AI toolkit that Eugene mentioned that gives marketers and brands insights into how their brand is performing on these new LLM platforms.

It allows them to analyze and monitor their brands and of course shape it inside these new algorithms. We launched the enterprise version of that in early June. That’s already up over $1,000,000 in annual recurring revenue. And collectively across our AI portfolio and our new enterprise portfolio, we see a path over $50,000,000 in annual recurring revenue by the 2025. So we’re in a strong position.

With the flexibility we have on our balance sheet, We thought it was a good time to show that conviction and put that $150,000,000 in share repurchase in place.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Is M and A part of the growth matrix? Maybe talk a little bit about that and kind of how you balance it sounds like you have a lot of organic product initiatives and kind of new customer segments that you’re targeting or enterprise. How do you balance kind of M and A with what you’re doing organically and think about that contributing to growth?

Brian Mulroy, CFO, SunRush: Definitely. I could start it. Maybe Eugene will add on to that. We’re absolutely acquisitive at this point. We’ve done a few acquisitions last year.

With that strong balance sheet and two sixty million in cash, we’re in a great position to be able to take advantage of that. We’re focused on seven core digital marketing areas, and our M and A strategy is to stay very closely adjacent to that core competency in those seven areas and make sure that we have a comprehensive digital marketing platform for all marketers and of course have enterprise grade capabilities. So we’ll continue to invest in M and A and make sure that we’re looking at opportunities to both build and buy so long as it’s advancing our strategic priorities forward.

DJ Hines, Senior Software Analyst, Canaccord: You guys have a new boss, I guess not new, he’s been on the Board for some time, but Bill Wagner took over as CEO fairly recently. Just talk about kind of his early strategic priorities and kind of any maybe changes in how you see him driving the business forward. Sure.

Eugene Levin, President and Chief Strategy Officer, SunRush: Yes. I think Bill saw a tremendous opportunity in this business, especially considering all the changes happening with AI. He saw how SEMrush is really well positioned to kind of win the market in our AI optimization portfolio. And I think in terms of strategy, he only focuses on doing this faster. So that’s, I think, the only change that we have seen so far.

He wants to go very aggressively after this new opportunity. Beyond that, like you said, he have been with us for many years, have been very active board member. And he also helped us quite a lot to build the team. He interviewed most of the c level hires during his tenure as as a board member. So there there were no any kind of surprises.

The only thing, you know, he he he wants to be maybe

DJ Hines, Senior Software Analyst, Canaccord: a bit more aggressive and go faster after the opportunity. Is is his DNA more product or go to market? Like, how would you describe him? Is he talking about, like, increasing the velocity of things?

Eugene Levin, President and Chief Strategy Officer, SunRush: Well, I I think he he’s definitely more of a go to market guy. He’s ex CMO. I think if you look at his tenure at other companies, he usually manages to combine really well PLG Motion with Enterprise Motion, which is very relevant for SEMrush as well. On the product side, I think he’s extremely experienced in product packaging. So I think you’ll maybe see a bit more of that.

But also, he’s he definitely has a good feel for what is a great product and pushes us to build great products. At the same time, he lets sort of artists and I consider engineers and product people to be a bit of artists. And he lets artists do their magic, especially when it comes to data science and figuring out the right metrics and algorithms behind them. So I think he’s great to work with from this point of view.

DJ Hines, Senior Software Analyst, Canaccord: Yes. It sounds like a good balance and a good fit for SEMrush. Maybe let’s take a little bit more of an intermediate term, longer term view. We look out three to five years, kind of what are going to be the biggest drivers for SEMrush going forward? And what are you most excited about?

Eugene Levin, President and Chief Strategy Officer, SunRush: So AI is, of course, a big part of that story. And enterprise, I think for AI, like Brian said, we really just started the portfolio that we have today. I think next year, same time next year, you’ll see the portfolio and you would say, wow, this thing that was driving a lot of growth in 2025 is now really just a small part of the entire AI optimization portfolio. And you’ll see a lot of that starting to happen later this year, and then we’ll continue ramping up functionality. So this is an extremely important driver for us.

And then, of course, enterprise, getting portfolio from one product to three products is extremely important, but we’re not going to stop there. We’ll keep adding more and more products into the portfolio to get bigger share of wallet.

Brian Mulroy, CFO, SunRush: And our enterprise go to market for sure. Yes. Mean we relied on that PLG motion. Basically, the product sold itself. We’re making a concerted effort to invest more in that enterprise go to market and believe, especially with the AR portfolio and the enterprise portfolio, that it will be a significant growth driver for us over the next three years.

DJ Hines, Senior Software Analyst, Canaccord: Yes. And I think you said enterprise is about 20% of the mix?

Brian Mulroy, CFO, SunRush: 20% from an enterprise segment perspective, and the enterprise product portfolio is just beginning.

DJ Hines, Senior Software Analyst, Canaccord: Yes. Maybe as our clock is ticking down on us here, just parting thoughts, right? Like what do you want investors to leave this session with? Do you think there’s anything that’s still misunderstood about the Semrush story? Help us think about kind of how this evolves over the next several quarters and years.

I think

Eugene Levin, President and Chief Strategy Officer, SunRush: the misunderstood part about our business probably is essentially this interconnection between search the way it, let’s say, existed in the past and the new AI search. And I think a lot of people feel that AI search is kind of more of a disruptive move for the market. But the way we see it is that pie only gets bigger When we look at total volume of interactions in Google, in ChatGPT, there are way more interactions today than a year ago, and it only keeps growing. And AI unlocks tons of new use cases that didn’t exist before. And so in terms of mindshare or time, like how much time people spend with search, traditional and new AI search, it only gets bigger.

And so as a result, SEMrush will have more important role in the broader MarTech ecosystem in the future. And I think that’s a misunderstood part. Because people only see a noise, a wave that kind of moves up and down. They don’t see the direction where the wave is going. Yes, that’s right.

I mean, it’s

DJ Hines, Senior Software Analyst, Canaccord: you guys are a leader in a space where you’re taking share, and then that space is just getting bigger and bigger, right? Well, this is a great conversation, super topical for everything that’s happening in software these days. So Eugene, Brian, thank you guys very much for being here. I appreciate it.

Brian Mulroy, CFO, SunRush: Thanks for having us, DJ.

DJ Hines, Senior Software Analyst, Canaccord: Thank you. Thank you. All right.

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