Tenable’s second quarter saw revenue and adjusted earnings surpass Wall Street expectations, but the stock traded down following the report. Management attributed the quarter’s performance to increased adoption of its Tenable One exposure management platform, which now accounts for a significant share of new sales. CEO Stephen Vintz pointed to strong growth in new customer wins and noted that “momentum we’re experiencing with our platform is a reflection of the importance our customers are placing on preemptive security.” However, cautious commentary regarding the federal sector and moderation in net retention rates signaled ongoing headwinds in parts of the business.
Is now the time to buy TENB? Find out in our full research report (it’s free).
Tenable (TENB) Q2 CY2025 Highlights:
- Revenue: $247.3 million vs analyst estimates of $242.1 million (11.8% year-on-year growth, 2.2% beat)
- Adjusted EPS: $0.34 vs analyst estimates of $0.30 (12.3% beat)
- Adjusted Operating Income: $47.7 million vs analyst estimates of $44.19 million (19.3% margin, 7.9% beat)
- The company slightly lifted its revenue guidance for the full year to $984 million at the midpoint from $975 million
- Adjusted EPS guidance for the full year is $1.49 at the midpoint, roughly in line with what analysts were expecting
- Operating Margin: -3%, in line with the same quarter last year
- Annual Recurring Revenue: $1.12 billion vs analyst estimates of $1.29 billion (20.6% year-on-year growth, 13.2% miss)
- Billings: $236.7 million at quarter end, up 5.5% year on year
- Market Capitalization: $3.59 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Tenable’s Q2 Earnings Call
- Rob Owens (Piper Sandler) asked about improved visibility in federal renewals compared to last quarter; CEO Stephen Vintz said confidence was higher in the renewal base, but expansion deals still face longer sales cycles.
- Brian Essex (JPMorgan) questioned Tenable One’s current and future penetration; Vintz replied that modest increases in platform adoption could materially accelerate growth, with federal stability eventually serving as a tailwind.
- Saket Kalia (Barclays) inquired about Tenable One’s competitive differentiation; Co-CEO Mark Thurmond explained that hybrid environment support and unified platform functionality drove recent competitive wins.
- Andrew Nowinski (Wells Fargo) asked whether larger deal sizes stemmed from new customers or renewals; Vintz confirmed strength came primarily from new logo growth, especially as customers committed to longer-term platform deals.
- William Joseph Vandrick (Scotiabank) sought clarification on AI security strategy post-Apex; Vintz and Thurmond outlined how Apex augments Tenable’s capabilities and is being embedded into the platform to meet growing customer demand.
Catalysts in Upcoming Quarters
In the quarters ahead, the StockStory team will be monitoring (1) the pace of Tenable One platform adoption across both new and existing customers, (2) further integration and monetization of AI security features following the Apex acquisition, and (3) stabilization in federal sector renewals and expansion opportunities. We will also track sector-specific growth in OT and cloud segments as key indicators of strategic execution.
Tenable currently trades at $29.60, down from $32.24 just before the earnings. In the wake of this quarter, is it a buy or sell? The answer lies in our full research report (it’s free).
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