HubSpot, Inc. HUBS is scheduled to report fourth-quarter 2024 results on Feb. 12, after the closing bell. In the last reported quarter, the company reported an earnings surprise of 15.34%. It pulled off a trailing four-quarter earnings surprise of 15.35%, on average.

Find the latest EPS estimates and surprises on Zacks Earnings Calendar.

The company is expected to report higher revenues year over year, backed by growing customer proliferation for its Service Hub, Marketing Hub and Sales Hub applications and initiatives to integrate advanced AI capabilities into its software solutions. Demand for Content hub and Commerce hub remains strong.

Factors at Play for HUBS

HubSpot is witnessing healthy user engagement across its customer relationship management platform. Pricing optimization and the transition to a seat pricing model have lowered the barrier for customers to get started with HubSpot and mitigated pricing friction for upgrades. This is expected to have driven customer growth in the starter editions from the lower end of the market. The company is also expected to have benefited from steady multi-hub adoption by enterprise customers in the premium market segment.

HUBS is also placing a strong emphasis on developing leading-edge AI tools and driving more value to customers. HubSpot's AI, which includes cutting-edge features such as AI assistance, AI agents, AI insights, and ChatSpot, is gaining popularity. These factors are expected to have generated incremental revenues for HubSpot.

During the quarter, HubSpot completed the acquisition of Cacheflow, an industry leader in B2B subscription billing management and configure, price, quote (CPQ) solution, for an undisclosed amount. With this acquisition, HubSpot is aiming to strengthen its Commerce Hubs’ functionalities and enhance its prospects in the emerging subscription and billing management market. This is likely to have a favorable impact on upcoming results.

The company also entered into a definite agreement to acquire Frame AI for an undisclosed amount. This acquisition of this AI-powered conversation intelligence platform highlights HubSpot’s ongoing efforts to combine powerful AI with an intuitive, scalable platform that can support businesses to better anticipate and respond to customer needs.

The Zacks Consensus Estimate for subscription revenues is pegged at $659.33 million, suggesting growth from $570.23 million reported in the year-ago quarter. Professional services revenues is projected at $14.42 million. Total number of customers is expected at 247,373.30, while average subscription revenue per customer is pegged at $10,845.89.

For the December quarter, the Zacks Consensus Estimate for total revenues is pegged at $673.67 million, indicating an increase from the year-ago quarter’s reported figure of $581.91 million. The consensus estimate for adjusted earnings per share is pegged at $2.19, representing a growth from $1.76 reported in the prior year.

Earnings Whispers

Our proven model does not conclusively predict an earnings beat for HubSpot this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of an earnings beat. This is not the case here.

Earnings ESP: Earnings ESP, which represents the difference between the Most Accurate Estimate and the Zacks Consensus Estimate, is -1.94%, with the former pegged at $2.15 and the latter at $2.19. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

HubSpot, Inc. Price and EPS Surprise

HubSpot, Inc. price-eps-surprise | HubSpot, Inc. Quote

Zacks Rank: HubSpot currently has a Zacks Rank #3.

Stocks to Consider

Here are some companies you may want to consider, as our model shows that these have the right combination of elements to post a beat this season:

The Earnings ESP for Zillow Group ZG is +15.52%, and it carries a Zacks Rank of 2 at present. The company is scheduled to report its quarterly numbers on Feb. 11. You can see the complete list of today’s Zacks #1 Rank stocks here.

The Earnings ESP for Akamai Technologies, Inc. AKAM is +0.09%, and it carries a Zacks Rank of 2 at present. The company is scheduled to report its quarterly numbers on Feb. 20.

The Earnings ESP for Watts Water Technologies WTS is +0.40%, and it carries a Zacks Rank of 3 at present. The company is scheduled to report its quarterly numbers on Feb. 10.

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