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Business Wire
08-05-2025
- Business
- Business Wire
N-able Announces First Quarter 2025 Results
BURLINGTON, Mass.--(BUSINESS WIRE)--N-able, Inc. (NYSE:NABL), a global software company delivering a unified cyber resiliency platform to manage, secure, and recover, today reported results for its first quarter ended March 31, 2025. 'Our earnings reflect continued progress advancing cyber-resiliency for businesses worldwide,' said N-able president and CEO John Pagliuca. 'The launch of new security capabilities, strong addition of channel partners in our Partner Program, and our largest new bookings deal ever showcase that N-able is innovating and growing. We look forward to building on this progress throughout the year.' 'We had a solid start to the year, with first quarter revenue and adjusted EBITDA both coming in above the high end of our guidance range and continued progress across our strategic priorities,' added N-able CFO Tim O'Brien. 'We are focused on maintaining this momentum, and delivering strong profit while driving ARR growth.' First quarter 2025 financial highlights: Total revenue of $118.2 million, representing 3.9% year-over-year growth, or 5.7% year-over-year growth on a constant currency basis. Subscription revenue of $116.8 million, representing 4.8% year-over-year growth, or 6.6% year-over-year growth on a constant currency basis. Total ARR of $492.7 million, representing 10.3% year-over-year growth, or 10.9% year-over-year growth on a constant currency basis. GAAP gross margin of 76.6% and non-GAAP gross margin of 80.6%. GAAP net loss of $7.2 million, or $(0.04) per diluted share, and non-GAAP net income of $15.6 million, or $0.08 per diluted share. Adjusted EBITDA of $31.6 million, representing an adjusted EBITDA margin of 26.8%. For a reconciliation of our GAAP to non-GAAP results, please see the tables below. Additional recent business highlights: N‑able launched its first annual 2025 State of the SOC Report—exploring the trends shaping security operations through real-world insights from Adlumin Managed Detection and Response (MDR). The report explores the challenges SOCs face in adapting to an expanding attack surface, highlighting their vital role in enhancing cybersecurity through expert threat monitoring, faster response times, and the use of AI to reduce dwell time. N-able expands its Microsoft Cloud management and security capabilities with Adlumin Breach Prevention for Microsoft 365—now part of the N-able Ecoverse. This newest addition helps protect IT infrastructures, defending against account takeovers, credential theft, and unauthorized access. N-able announced the upcoming launch of its Vulnerability Management feature for its UEM (Unified Endpoint Management) products, N-central and N-sight. The new built-in feature will allow organizations to identify, prioritize, remediate, and report on vulnerabilities across all major operating systems (OS). N-able was recognized by CRN®, a brand of The Channel Company, with a prestigious 5-Star Award in its 2025 Partner Program Guide for the fourth consecutive year. N-able announced that its Board of Directors approved a share repurchase program authorizing the company to repurchase up to an aggregate of $75 million of shares of its common stock. Balance Sheet As of March 31, 2025, total cash and cash equivalents were $94.1 million and total debt, net of debt issuance costs, was $332.6 million. The financial results included in this press release are preliminary and pending final review by the company and its external auditors. Financial results will not be final until N-able files its quarterly report on Form 10-Q for the period. Information about N-able's use of non-GAAP financial measures is provided below under 'Non-GAAP Financial Measures.' Financial Outlook As of May 8, 2025, N-able is providing its financial outlook for the second quarter of 2025 and full-year 2025. The financial information below represents forward-looking non-GAAP financial information, including adjusted EBITDA. These non-GAAP financial measures exclude, among other items mentioned below, amortization of acquired intangible assets and developed technology, depreciation expense, income tax expense, interest expense, net, unrealized foreign currency (gains) losses, transaction related costs, spin-off costs, stock-based compensation expense and related employer-paid payroll taxes and restructuring and other costs. We have not reconciled our estimates of these non-GAAP financial measures to their most directly comparable GAAP measure as a result of uncertainty regarding, and the potential variability of, these excluded items in future periods. Accordingly, reconciliation is not available without unreasonable effort, although it is important to note that these excluded items could be material to our results computed in accordance with GAAP in future periods. Our reported results provide reconciliations of non-GAAP financial measures to their nearest GAAP equivalents. The financial outlook provided below reflects N-able's expectations, as of the date of this release, regarding the impact on its business of changing foreign exchange rates and current macroeconomic dynamics. Financial Outlook for the Second Quarter of 2025 N-able management currently expects to achieve the following results for the second quarter of 2025: Total revenue in the range of $125.5 to $126.5 million, representing approximately 5% to 6% year-over-year growth on a reported and constant currency basis. Adjusted EBITDA in the range of $34.0 to $35.0 million, representing approximately 27% to 28% of total revenue. Financial Outlook for Full-Year 2025 N-able management currently expects to achieve the following results for the full-year 2025: Total ARR in the range of $519 to $525 million, representing 8% to 9% year-over-year growth, or approximately 7% to 9% on a constant currency basis. Total revenue in the range of $492 to $497 million, representing approximately 6% to 7% year-over-year growth, or approximately 6% to 8% growth on a constant currency basis. Adjusted EBITDA in the range of $134 to $139 million, representing approximately 27% to 28% of total revenue. Additional details on the company's outlook will be provided on the conference call. Conference Call and Webcast In conjunction with this announcement, N-able will host a conference call today to discuss its financial results, business and business outlook at 8:30 a.m. ET on May 8, 2025. A live webcast of the call will be available on the N-able Investor Relations website at A replay of the webcast will be available on a temporary basis shortly after the event on the N-able Investor Relations website. Forward-Looking Statements This press release contains 'forward-looking' statements, which are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995, including statements regarding our financial outlook for the second quarter and full-year 2025 and the impact of macroeconomic conditions on our business. These forward-looking statements are based on management's beliefs and assumptions and on information currently available to management. Forward-looking statements include all statements that are not historical facts and may be signified by terms such as 'aim,' 'anticipate,' 'believe,' 'continue,' 'expect,' 'feel,' 'intend,' 'estimate,' 'seek,' 'plan,' 'may,' 'can,' 'could,' 'should,' 'will,' 'would' or similar expressions and the negatives of those terms. Forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause our actual results, performance or achievements to be materially and adversely different from any future results, performance or achievements expressed or implied by the forward-looking statements. Factors that could cause or contribute to such differences include, but are not limited to, the following: (a) the impact of adverse economic conditions; (b) our ability to sell subscriptions to new customers, to sell additional solutions to our existing customers and to increase the usage of our solutions by our existing customers, as well as our ability to generate and maintain customer loyalty; (c) any decline in our renewal or net retention rates; (d) the possibility that general economic, political, legal and regulatory conditions and uncertainty may cause information technology spending to be reduced or purchasing decisions to be delayed, including as a result of inflation, actions taken by central banks to counter inflation, rising interest rates, war and political unrest, military conflict (including between Russia and Ukraine and in the Middle East), terrorism, sanctions, trade or other issues in the U.S. and internationally, or that such factors may otherwise harm our business, financial condition or results of operations; (e) recent significant changes to U.S. trade policies and reciprocal trade measures enacted or threatened, which have led and may continue to lead to volatility and uncertainty, including increased market volatility and currency exchange rate fluctuations, which may also cause information technology spending to be reduced or purchasing decisions to be delayed; (f) any inability to generate significant volumes of high-quality sales leads from our digital marketing initiatives and convert such leads into new business at acceptable conversion rates; (g) any inability to successfully identify, complete and integrate acquisitions and manage our growth effectively; (h) any inability to resell third-party software or integrate third-party software into our solutions, or find suitable replacements for such third-party software; (i) risks associated with our international operations; (j) foreign exchange gains and losses related to expenses and sales denominated in currencies other than the functional currency of an associated entity; (k) risks that cyberattacks, including the cyberattack on SolarWinds' Orion Software Platform and internal systems announced by SolarWinds in December 2020 (the 'Cyber Incident'), and other security incidents may result in compromises or breaches of our, our customers', or their SMB and mid-market customers' systems, the insertion of malicious code, malware, ransomware or other vulnerabilities into our, our customers', or their SMB and mid-market customers' environments, the exploitation of vulnerabilities in our, our customers', or their SMB and mid-market customers' security, the theft or misappropriation of our, our customers', or their SMB and mid-market customers' proprietary and confidential information, and interference with our, our customers', or their SMB and mid-market customers' operations, exposure to legal and other liabilities, higher customer and employee attrition and the loss of key personnel, negative impacts to our sales, renewals and upgrades and reputational harm and other serious negative consequences, any or all of which could materially harm our business; (l) our status as a controlled company; (m) our ability to attract and retain qualified employees and key personnel; (n) the timing and success of new product introductions and product upgrades by us or our competitors; (o) our ability to maintain or grow our brands, including the Adlumin brand; (p) our ability to protect and defend our intellectual property and not infringe upon others' intellectual property; (q) the possibility that our operating income could fluctuate and may decline as a percentage of revenue as we make further expenditures to expand our operations in order to support growth in our business; (r) our indebtedness, including increased borrowing costs resulting from rising interest rates, potential restrictions on our operations and the impact of events of default; (s) our ability to operate our business internationally and increase sales of our solutions to our customers located outside of the United States; (t) risks related to our spin-off from SolarWinds into a newly created and separately-traded public company, including that the spin-off may not achieve some or all of any anticipated benefits with respect to our business; that the distribution, together with certain related transactions, may not qualify as a transaction that is generally tax-free for U.S. federal income tax purposes, which could result in N-able incurring significant tax liabilities, and, in certain circumstances, requiring us to indemnify SolarWinds for material taxes and other related amounts pursuant to indemnification obligations under the tax matters agreement; and (u) such other risks and uncertainties described more fully in documents filed with or furnished to the Securities and Exchange Commission, including the risk factors described in N-able's Annual Report on Form 10-K for the year ended December 31, 2024, that N-able filed with the SEC on March 7, 2025. All information provided in this release is as of the date hereof and N-able undertakes no duty to update this information except as required by law. Non-GAAP Financial Measures In addition to financial measures prepared in accordance with GAAP, we use certain non-GAAP financial measures to clarify and enhance our understanding, and aid in the period-to-period comparison, of our performance. We believe that these non-GAAP financial measures provide supplemental information that is meaningful when assessing our operating performance because they exclude the impact of certain amounts that our management and board of directors do not consider part of core operating results when assessing our operational performance, allocating resources, preparing annual budgets and determining compensation. Accordingly, these non-GAAP financial measures may provide insight to investors into the motivation and decision-making of management in operating the business. N-able also believes that these non-GAAP financial measures are used by investors and securities analysts to (a) compare and evaluate its performance from period to period and (b) compare its performance to those of its competitors. These non-GAAP measures exclude certain items that can vary substantially from company to company depending upon their financing and accounting methods, the book value of their assets, their capital structures and the method by which their assets were acquired. As a result, these non-GAAP financial measures have limitations and should not be considered in isolation from, or as a substitute for, their most comparable GAAP measures. These non-GAAP financial measures are not prepared in accordance with GAAP, do not reflect a comprehensive system of accounting and may not be completely comparable to similarly titled measures of other companies due to potential differences in the exact method of calculation between companies. Certain items that are excluded from these non-GAAP financial measures can have a material impact on operating and net income. N-able's management and board of directors compensate for these limitations by using these non-GAAP financial measures as supplements to GAAP financial measures and by reviewing the reconciliations of the non-GAAP financial measures to their most comparable GAAP financial measure. Set forth in the tables below are the corresponding GAAP financial measures for each non-GAAP financial measure presented. Investors are encouraged to review the reconciliations of these non-GAAP financial measures to their most comparable GAAP financial measures that are set forth in the tables below. Definitions of Non-GAAP and Other Metrics Annual Recurring Revenue (ARR). We calculate ARR by annualizing the recurring revenue and related usage revenue inclusive of discounts, excluding the impacts of credits and reserves, recognized during the last day of the reporting period from both long-term and month-to-month subscriptions. We believe ARR enhances the understanding of our business performance and the growth of our relationships with our customers. Non-GAAP Gross Margin, Non-GAAP Operating Income and Non-GAAP Operating Margin. We provide non-GAAP total cost of revenue, non-GAAP gross margin, non-GAAP operating expense and non-GAAP operating income and related non-GAAP gross and operating margins excluding such items as stock-based compensation expense and related employer-paid payroll taxes, amortization of acquired intangible assets, transaction related costs, spin-off costs and restructuring costs and other. We define non-GAAP gross and operating margins as non-GAAP gross profit and operating income divided by total revenue. Management believes these measures are useful for the following reasons: Stock-Based Compensation Expense and Related Employer-Paid Payroll Taxes. We provide non-GAAP information that excludes expenses related to stock-based compensation and related employer-paid payroll taxes associated with our employees' participation in N-able's stock-based incentive compensation plans. We believe that the exclusion of stock-based compensation expense provides for a better comparison of our operating results to prior periods and to our peer companies as the calculations of stock-based compensation vary from period to period and company to company due to different valuation methodologies, subjective assumptions and the variety of award types. Employer-paid payroll taxes on stock-based compensation is dependent on our stock price and the timing of the taxable events related to the equity awards, over which our management has little control, and does not necessarily correlate to the core operation of our business. Because of these unique characteristics of stock-based compensation and related employer-paid payroll taxes, management excludes these expenses when analyzing the organization's business performance. Amortization of Acquired Technologies and Intangible Assets. We provide non-GAAP information that excludes expenses related to purchased technologies and intangible assets associated with our acquisitions. We believe that eliminating this expense from our non-GAAP measures is useful to investors because the amortization of acquired technologies and intangible assets can be inconsistent in amount and frequency and is significantly impacted by the timing and magnitude of our acquisition transactions, which also vary in frequency from period to period. Accordingly, we analyze the performance of our operations in each period without regard to such expenses. Transaction Related Costs. We exclude certain expense items resulting from proposed and completed acquisitions, dispositions and similar transactions, such as legal, accounting and advisory fees, changes in fair value of contingent consideration, costs related to integrating the acquired businesses, deferred compensation, severance and retention expense. We consider these adjustments, to some extent, to be unpredictable and dependent on a significant number of factors that are outside of our control. Furthermore, such proposed and completed transactions result in operating expenses that would not otherwise have been incurred by us in the normal course of our organic business operations. We believe that providing non-GAAP measures that exclude transaction related costs allows investors to better review and understand the historical and current results of our continuing operations and also facilitates comparisons to our historical results and results of peer companies with different transaction related activities, both with and without such adjustments. Spin-off Costs. We exclude certain expense items resulting from the spin-off into a newly created and separately traded public company. These costs include legal, accounting and advisory fees, system implementation costs and other incremental costs incurred by us related to the separation from SolarWinds. The spin-off transaction results in operating expenses that would not otherwise have been incurred by us in the normal course of our organic business operations. We believe that providing non-GAAP measures that exclude these costs facilitates a more meaningful evaluation of our operating performance and comparisons to our past operating performance. Restructuring Costs and Other. We provide non-GAAP information that excludes restructuring costs such as severance, certain employee relocation costs, and the estimated costs of exiting and terminating facility lease commitments, as they relate to our corporate restructuring and exit activities. These costs are inconsistent in amount and are significantly impacted by the timing and nature of these events. Therefore, although we may incur these types of expenses in the future, we believe that eliminating these costs for purposes of calculating the non-GAAP financial measures facilitates a more meaningful evaluation of our operating performance and comparisons to our past operating performance. Non-GAAP Net Income and Non-GAAP Net Income Per Diluted Share. We believe that the use of non-GAAP net income and non-GAAP net income per diluted share is helpful to our investors to clarify and enhance their understanding of past performance and future prospects. Non-GAAP net income is calculated as net income excluding the adjustments to non-GAAP gross profit and non-GAAP operating income and the income tax effect of the non-GAAP exclusions. We define non-GAAP net income per diluted share as non-GAAP net income divided by the weighted average outstanding common shares. Adjusted EBITDA and Adjusted EBITDA Margin. We regularly monitor adjusted EBITDA and adjusted EBITDA margin, as they are measures we use to assess our operating performance. We define adjusted EBITDA as net income or loss, excluding amortization of acquired intangible assets and developed technology, depreciation expense, income tax expense, interest expense, net, unrealized foreign currency (gains) losses, transaction related costs, spin-off costs, stock-based compensation expense and related employer-paid payroll taxes and restructuring and other costs. We define adjusted EBITDA margin as adjusted EBITDA divided by total revenue. Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations include: although depreciation and amortization are non-cash charges, the assets being depreciated and amortized may have to be replaced in the future, and adjusted EBITDA does not reflect cash capital expenditure requirements for such replacements or for new capital expenditure requirements; adjusted EBITDA does not reflect changes in, or cash requirements for, our working capital needs; adjusted EBITDA does not reflect the significant interest expense, or the cash requirements necessary to service interest or principal payments, on our related party debt; adjusted EBITDA does not reflect tax payments that may represent a reduction in cash available to us; and other companies, including companies in our industry, may calculate adjusted EBITDA differently, which reduces its usefulness as a comparative measure. Non-GAAP Revenue on a Constant Currency Basis. We provide non-GAAP revenue on a constant currency basis to provide a framework for assessing our performance excluding the effect of foreign currency rate fluctuations. To present this information, current period results for revenue contracts denominated in currencies other than U.S. Dollars are converted into U.S. Dollars at the average exchange rates in effect during the corresponding prior period presented. We believe that providing non-GAAP revenue on a constant currency basis facilitates the comparison of non-GAAP revenue to prior periods. Unlevered Free Cash Flow. Unlevered free cash flow is a measure of our liquidity used by management to evaluate cash flow from operations, after the deduction of capital expenditures and prior to the impact of our capital structure, transaction related costs, restructuring costs, spin-off costs, employer-paid payroll taxes on stock awards and other one-time items, that can be used by us for strategic opportunities and strengthening our balance sheet. However, given our debt obligations, unlevered free cash flow does not represent residual cash flow available for discretionary expenses. About N-able N‑able's mission is to protect businesses against evolving cyberthreats with a unified cyber resiliency platform to manage, secure, and recover. Our scalable technology infrastructure includes AI-powered capabilities, market-leading third-party integrations, and the flexibility to employ technologies of choice—to transform workflows and deliver critical security outcomes. Our partner-first approach combines our products with experts, training, and peer-led events that empower our customers to be secure, resilient, and successful. © 2025 N-able, Inc. All rights reserved. Category: Financial N-able, Inc. Consolidated Balance Sheets (In thousands) (Unaudited) March 31, 2025 2024 Assets Current assets: Cash and cash equivalents $ 94,090 $ 85,196 Accounts receivable, net of allowances of $946 and $886 as of March 31, 2025 and December 31, 2024, respectively 44,584 44,909 Income tax receivable 3,680 3,563 Recoverable taxes 11,909 24,157 Current contract assets 9,927 12,786 Prepaid and other current assets 19,595 13,312 Total current assets 183,785 183,923 Property and equipment, net 35,543 36,162 Operating lease right-of-use assets 29,789 27,998 Deferred taxes 2,091 2,026 Goodwill 991,352 977,013 Intangible assets, net 78,646 83,150 Other assets, net 30,871 28,575 Total assets $ 1,352,077 $ 1,338,847 Liabilities and stockholders' equity Current liabilities: Accounts payable $ 3,692 $ 6,290 Accrued liabilities and other 45,980 51,057 Current contingent consideration 14,750 5,500 Current deferred consideration 46,108 44,023 Current operating lease liabilities 6,669 6,018 Income taxes payable 10,018 9,733 Current portion of deferred revenue 22,953 23,977 Current debt obligation 3,500 3,500 Total current liabilities 153,670 150,098 Long-term liabilities: Deferred revenue, net of current portion 3,462 2,996 Non-current deferred taxes 3,494 3,448 Non-current operating lease liabilities 30,794 30,069 Long-term debt, net of current portion 329,121 329,606 Non-current deferred consideration 55,692 54,089 Other long-term liabilities 743 9,253 Total liabilities 576,976 579,559 Commitments and contingencies Stockholders' equity: Common stock, $0.001 par value: 550,000,000 shares authorized and 189,059,535 and 187,528,505 shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively 189 187 Preferred stock, $0.001 par value: 50,000,000 shares authorized and no shares issued and outstanding as of March 31, 2025 and December 31, 2024, respectively — — Additional paid-in capital 715,540 708,992 Accumulated other comprehensive loss (4,670 ) (21,095 ) Retained earnings 64,042 71,204 Total stockholders' equity 775,101 759,288 Total liabilities and stockholders' equity $ 1,352,077 $ 1,338,847 Expand N-able, Inc. Consolidated Statements of Operations (In thousands, except per share information) (Unaudited) Three Months Ended March 31, 2025 2024 Revenue: Subscription and other revenue $ 118,197 $ 113,749 Cost of revenue: Cost of revenue 23,511 17,836 Amortization of acquired technologies 4,167 461 Total cost of revenue 27,678 18,297 Gross profit 90,519 95,452 Operating expenses: Sales and marketing 40,404 35,816 Research and development 23,884 22,082 General and administrative 23,908 17,049 Amortization of acquired intangibles 499 14 Total operating expenses 88,695 74,961 Operating income 1,824 20,491 Other expense, net: Interest expense, net (7,071 ) (7,621 ) Other income, net 1,385 285 Total other expense, net (5,686 ) (7,336 ) (Loss) income before income taxes (3,862 ) 13,155 Income tax expense 3,300 5,699 Net (loss) income $ (7,162 ) $ 7,456 Net (loss) income per share: Basic (loss) income per share $ (0.04 ) $ 0.04 Diluted (loss) income per share $ (0.04 ) $ 0.04 Weighted-average shares used to compute net (loss) income per share: Shares used in computation of basic (loss) income per share: 188,234 184,015 Shares used in computation of diluted (loss) income per share: 188,234 187,174 Expand N-able, Inc. Consolidated Statements of Cash Flows (In thousands) (Unaudited) Three Months Ended March 31, 2025 2024 Cash flows from operating activities Net (loss) income $ (7,162 ) $ 7,456 Adjustments to reconcile net (loss) income to net cash provided by operating activities: Depreciation and amortization 10,417 5,819 Provision for doubtful accounts 60 53 Stock-based compensation expense 11,669 11,547 Deferred taxes 20 (6 ) Amortization of debt issuance costs 390 399 (Gain) loss on foreign currency exchange rates (783 ) 796 Loss (gain) on contingent consideration 700 (1,407 ) Deferred consideration expense 3,688 — Gain on lease modification (413 ) — Other non-cash expenses 141 84 Changes in operating assets and liabilities, net of assets acquired and liabilities assumed in business combinations: Accounts receivable 268 (121 ) Income tax receivable (89 ) (2,462 ) Recoverable taxes 12,420 (3,464 ) Current contract assets 2,859 (3,708 ) Operating lease right-of-use assets, net (365 ) (46 ) Prepaid expenses and other assets (6,698 ) (1,809 ) Accounts payable (2,710 ) (1,389 ) Accrued liabilities and other (3,901 ) (11,705 ) Income taxes payable 349 6,005 Deferred revenue (558 ) 289 Other long-term assets (661 ) (1,920 ) Other long-term liabilities 36 (227 ) Net cash provided by operating activities 19,677 4,184 Cash flows from investing activities Purchases of property and equipment (3,288 ) (3,438 ) Purchases of intangible assets (2,788 ) (1,689 ) Net cash used in investing activities (6,076 ) (5,127 ) Cash flows from financing activities Payments of tax withholding obligations related to restricted stock units (7,712 ) (12,241 ) Exercise of stock options 2 — Proceeds from issuance of common stock under employee stock purchase plan 1,296 1,200 Repayments of borrowings from Credit Agreement (875 ) (875 ) Net cash used in financing activities (7,289 ) (11,916 ) Effect of exchange rate changes on cash and cash equivalents 2,582 (962 ) Net increase (decrease) in cash and cash equivalents 8,894 (13,821 ) Cash and cash equivalents Beginning of period 85,196 153,048 End of period $ 94,090 $ 139,227 Supplemental disclosure of cash flow information: Cash paid for interest $ 6,447 $ 7,270 Cash paid for income taxes $ 2,157 $ 1,779 Supplemental disclosure of non-cash activities: Change in purchases of property, equipment and leasehold improvements included in accounts payable and accrued expenses $ 29 $ 179 Right-of-use assets obtained in exchange for operating lease liabilities $ 3,338 $ — Expand N-able, Inc. Reconciliation of GAAP to Non-GAAP Financial Measures (In thousands, except per share information) (Unaudited) Three Months Ended March 31, 2025 2024 GAAP cost of revenue $ 27,678 $ 18,297 Stock-based compensation expense and related employer-paid payroll taxes (468 ) (447 ) Amortization of acquired technologies (4,167 ) (461 ) Transaction related costs (147 ) — Non-GAAP cost of revenue $ 22,896 $ 17,389 GAAP gross profit $ 90,519 $ 95,452 Stock-based compensation expense and related employer-paid payroll taxes 468 447 Amortization of acquired technologies 4,167 461 Transaction related costs 147 — Non-GAAP gross profit $ 95,301 $ 96,360 GAAP sales and marketing expense $ 40,404 $ 35,816 Stock-based compensation expense and related employer-paid payroll taxes (4,465 ) (4,373 ) Transaction related costs (951 ) — Restructuring costs and other (160 ) (171 ) Non-GAAP sales and marketing expense $ 34,828 $ 31,272 GAAP research and development expense $ 23,884 $ 22,082 Stock-based compensation expense and related employer-paid payroll taxes (2,975 ) (2,785 ) Transaction related costs (80 ) — Restructuring costs and other (122 ) (24 ) Non-GAAP research and development expense $ 20,707 $ 19,273 GAAP general and administrative expense $ 23,908 $ 17,049 Stock-based compensation expense and related employer-paid payroll taxes (4,776 ) (5,362 ) Transaction related costs (5,076 ) 1,396 Restructuring costs and other 420 (431 ) Spin-off costs — (51 ) Non-GAAP general and administrative expense $ 14,476 $ 12,601 GAAP operating income $ 1,824 $ 20,491 Amortization of acquired technologies 4,167 461 Amortization of acquired intangibles 499 14 Stock-based compensation expense and related employer-paid payroll taxes 12,684 12,967 Transaction related costs 6,254 (1,396 ) Restructuring costs and other (138 ) 626 Spin-off costs — 51 Non-GAAP operating income $ 25,290 $ 33,214 GAAP operating margin 1.5 % 18.0 % Non-GAAP operating margin 21.4 % 29.2 % GAAP net (loss) income $ (7,162 ) $ 7,456 Amortization of acquired technologies 4,167 461 Amortization of acquired intangibles 499 14 Stock-based compensation expense and related employer-paid payroll taxes 12,684 12,967 Transaction related costs 6,254 (1,396 ) Restructuring costs and other (138 ) 626 Spin-off costs — 51 Tax benefits associated with above adjustments (1) (683 ) (344 ) Non-GAAP net income $ 15,621 $ 19,835 GAAP diluted (loss) income per share $ (0.04 ) $ 0.04 Non-GAAP diluted income per share $ 0.08 $ 0.11 Shares used in computation of GAAP diluted (loss) income per share: 188,234 187,174 Expand _________________ (1) The tax benefits associated with non-GAAP adjustments for the three months ended March 31, 2025, and 2024, respectively, is calculated utilizing the Company's individual statutory tax rates for each impacted subsidiary. Expand N-able, Inc. Reconciliation of GAAP Net (Loss) Income to Adjusted EBITDA (In thousands) (Unaudited) Three Months Ended March 31, 2025 2024 Net (loss) income $ (7,162 ) $ 7,456 Amortization 6,178 1,862 Depreciation 4,239 3,957 Income tax expense 3,300 5,699 Interest expense, net 7,071 7,621 Unrealized foreign currency (gains) losses (783 ) 796 Transaction related costs 6,254 (1,396 ) Spin-off costs — 51 Stock-based compensation expense and related employer-paid payroll taxes 12,684 12,967 Restructuring costs and other (138 ) 626 Adjusted EBITDA $ 31,643 $ 39,639 Adjusted EBITDA margin 26.8 % 34.8 % Expand _________________ (1) The estimated foreign currency impact is calculated using the average foreign currency exchange rates in the comparable prior year monthly periods and applying those rates to foreign-denominated revenue in the corresponding monthly periods for the three months ended March 31, 2025. Expand N-able, Inc. Reconciliation of Unlevered Free Cash Flow (In thousands) (Unaudited) Three Months Ended March 31, 2025 2024 Net cash provided by operating activities $ 19,677 $ 4,184 Purchases of property and equipment (3,288 ) (3,438 ) Purchases of intangible assets (2,788 ) (1,689 ) Free cash flow 13,601 (943 ) Cash paid for interest, net of cash interest received 6,447 7,270 Cash paid for transaction related costs, restructuring costs, spin-off costs, employer-paid payroll taxes on stock awards and other one-time items 8,087 952 Unlevered free cash flow $ 28,135 $ 7,279 Expand
Techday NZ
25-04-2025
- Business
- Techday NZ
AI enhances SOCs but human expertise vital against threats
N-able has published its first annual report examining the current landscape and future prospects of Security Operations Centres (SOCs), drawing on operational data from Adlumin's Managed Detection and Response (MDR) SOC team. The report, titled the 2025 State of the SOC Report, analyses the increasing complexity of cyberthreats and the evolving role of SOCs in defending against them, with a particular focus on the impact of artificial intelligence (AI) and the continued necessity of human oversight. According to N-able, the prevalence and sophistication of cyberattacks continue to rise, pushing SOCs to adapt beyond traditional response mechanisms. The implementation of AI within SOC operations is identified as central to improving efficiency, notably by automating tasks that were once handled manually and allowing analysts to divert attention to critical threat anticipation and response. Vikram Ramesh, Chief Strategy Officer at N-able, commented on the findings: "Today's cybersecurity environment demands more than detection—it requires precision, adaptability, and speed. This report reinforces what we're seeing across the industry: cyber resiliency hinges on integrating AI with expert-led response. "We're focused on building security operations that are resilient by design, capable of adapting in real-time, and ready to meet future challenges. Adlumin's SOC exemplifies our mission of delivering protection that's not just reactive but proactively built to anticipate and outpace evolving threats." The report's conclusions are based on frontline incidents from Adlumin MDR SOC between December 2024 and February 2025. During this period, the SOC processed nearly 500,000 security alerts and raised 83,171 escalations. The report confirms that ransomware was a persistent major threat, with 2,684 ransomware incidents handled in that timeframe. AI is credited with significant gains in SOC efficiency, with applications reducing analysis time and lessening the need for extended human review. The report highlights that AI can identify indicators of compromise in as little as 10 seconds. It is estimated that AI-managed automation now enables 70% of all incident investigations and remediation actions to be handled without direct human input. Despite the gains from automation, the report underscores that specialised human expertise is still a cornerstone of SOC effectiveness. According to the findings, 86% of security alerts generated escalate to tickets, reflecting the fact that most incidents still require human validation or intervention to resolve effectively. Another trend noted in the report is the shifting locus of threat detection. Endpoints remain the primary source, accounting for 56% of detections during the study period. However, cloud environments are quickly narrowing the divide, now representing 44% of all threat detections. The report also notes that nearly all breaches in cloud settings require account containment as part of remediation efforts. Will Ledesma, Senior Director of MDR Cybersecurity Operations at Adlumin, shared perspective on the recent changes: "In 2024, the threat landscape escalated. The Adlumin MDR SOC was on the front lines of that shift, responding to thousands of escalations. What we've seen is clear: AI in cybersecurity is no longer just about enrichment; it's about adaptation. The State of the SOC Report reflects our journey: the threats we faced, the wins we earned, and how we continue to advance and evolve for businesses looking to outpace threats in 2025." The report is designed to provide actionable insight for SOC operators, IT decision-makers, and cybersecurity professionals assessing the adoption of AI technologies in their operations. The experiences of the Adlumin SOC team during the observed period are presented as evidence of the tangible benefits and current limitations of AI in security management, with a clear emphasis on the necessity for ongoing human expertise. N-able's research is one of several ongoing industry examinations into the integration of automation and AI in cyberdefence and its implications for organisational resilience against accelerating digital threats.
Business Wire
24-04-2025
- Business
- Business Wire
N-able Report Reveals the Future of the SOC Relies on AI, While Human Intervention Remains Essential
BURLINGTON, Mass.--(BUSINESS WIRE)-- N‑able, Inc. (NYSE: NABL), a global software company delivering a unified cyber resiliency platform to manage, secure, and recover, today launched its first annual 2025 State of the SOC Report— exploring the trends shaping security operations through real-world insights from Adlumin Managed Detection and Response (MDR). The report explores the challenges SOCs face in adapting to an expanding attack surface, highlighting their vital role in enhancing cybersecurity through expert threat monitoring, faster response times, and the use of AI to reduce dwell time. Cyberthreats have intensified, testing the resilience of security teams as attackers grow more elusive and relentless. SOCs remain a critical line of defense—but keeping pace demands more than traditional playbooks. Integrating AI into SOC workflows isn't just a strategic shift—we believe it's a major key to unlocking new levels of efficiency that the human factor alone can't deliver. From accelerating detections to automating investigations and reporting, AI empowers analysts to focus on what truly matters: anticipating threats, not just reacting to them. 'Today's cybersecurity environment demands more than detection—it requires precision, adaptability, and speed. This report reinforces what we're seeing across the industry: cyber resiliency hinges on integrating AI with expert-led response,' said Vikram Ramesh, Chief Strategy Officer at N-able. 'We're focused on building security operations that are resilient by design, capable of adapting in real-time, and ready to meet future challenges. Adlumin's SOC exemplifies our mission of delivering protection that's not just reactive but proactively built to anticipate and outpace evolving threats.' The 2025 State of the SOC Report highlights key takeaways related to incident preparedness and response, all stemming from the frontline experiences of the Adlumin MDR SOC during December 2024 through February 2025. A few key findings include: AI is a dominant driver of improvements to SOC efficiency: The use of AI tools has cut down SOC analysis time, eliminating the need for lengthy human review. AI now pulls indicators of compromise (IOCs) in as quickly as 10 seconds. Human expertise remains critical in AI & SOC success: While AI can help combat threats, it cannot fully take the place of SOC analysts. The report reveals that 86% of security alerts escalate into tickets, which indicates most alerts still require human validation. Most threat detections still stem from endpoints—cloud environments are quickly closing the gap: 56% of detections originate from the endpoint and 44% originate from the cloud. Additionally, almost all cloud-based breaches require account containment to mitigate threats. Majority of incident investigations can be completely automated with AI, reducing response time and analyst workload: AI can automate 70% of all incident investigations and threat remediation activity. The report's findings are pulled directly from the Adlumin SOC between December 2024 and February 2025, which has successfully protected businesses by processing nearly 500,000 alerts and creating 83,171 security escalations. Among these incidents, ransomware remained a top concern, with the team handling 2,684 ransomware threats. 'In 2024, the threat landscape escalated. The Adlumin MDR SOC was on the front lines of that shift, responding to thousands of escalations,' said Will Ledesma, Senior Director of MDR Cybersecurity Operations at Adlumin, an N-able company. 'What we've seen is clear: AI in cybersecurity is no longer just about enrichment; it's about adaptation. The State of the SOC Report reflects our journey: the threats we faced, the wins we earned, and how we continue to advance and evolve for businesses looking to outpace threats in 2025.' To view the full report, please visit Adlumin will showcase the advanced AI capabilities and key features of its MDR platform at RSA Conference 2025, which will take place April 28–May 1 at the Moscone Center in San Francisco, California. Attendees can visit Adlumin, an N-able company, at Booth #2233 in the South Hall or book a meeting in advance to connect with the team: About N‑able N‑able's mission is to protect businesses against evolving cyberthreats with a unified cyber resilient platform to manage, secure, and recover. Our scalable technology infrastructure includes AI-powered capabilities, market-leading third-party integrations, and the flexibility to employ technologies of choice—to transform workflows and deliver critical security outcomes. Our partner-first approach combines our products with experts, training, and peer-led events that empower our customers to be secure, resilient, and successful. © 2025 N‑able Solutions ULC and N‑able Technologies Ltd. All rights reserved. The N‑able trademarks, service marks, and logos are the exclusive property of N‑able Solutions ULC and N‑able Technologies Ltd. All other trademarks are the property of their respective owners. Category: Company
