N-able raises 2025 full-year revenue and ARR outlooks as AI and security offerings drive momentum

Earnings Call Insights: N-able, Inc. (NABL) Q3 2025

MANAGEMENT VIEW

* CEO John Pagliuca described the quarter as one of “strong third quarter results, reflecting robust demand for cybersecurity and the rising strategic relevance of N-able.” He highlighted that third quarter ARR was $528 million, up 14% year-over-year, and adjusted EBITDA margin was 31%. Pagliuca emphasized improved gross and net retention rates on both year-over-year and quarter-over-quarter bases, and pointed to the company’s expanded security capabilities and scaled channel-first go-to-market strategy as core drivers of growth.
* Pagliuca noted significant investment in AI, stating, "Leveraging proprietary data from our 11 million IT assets, we are embedding innovative AI capabilities across our platform, arming organizations with the cutting-edge solutions they need to defend themselves in today's cyber battleground." He positioned N-able’s platform breadth and data as key differentiators in the evolving cybersecurity landscape.
* The CEO also reported new offerings such as Anomaly Detection as a Service and described the transition from reactive defense to proactive resilience as a “strategic shift.” He cited that data protection led net new ARR growth and referenced a major mid-market deal win of approximately $0.5 million in ARR for UEM solutions.
* Executive VP & CFO Tim O'Brien stated, "Our strategy remains disciplined, delivering scalable cyber resilience for small and mid-market businesses throughout our expanded channel ledge approach. This quarter's performance reflects that focus, strong top line growth, quality margins, healthy free cash flow and considerable operational progress."

OUTLOOK

* N-able raised its total revenue outlook for the full year 2025 to approximately $507.7 million to $508.7 million, representing about 9% year-over-year growth on a reported basis. The company also raised its full year ARR outlook to $530 million to $531 million, representing 10% year-over-year growth. Adjusted EBITDA outlook for the full year was increased to $148.2 million to $149.2 million, with a 29% margin expected. For Q4 2025, the company expects total revenue in the range of $126.5 million to $127.5 million, and adjusted EBITDA in the range of $33.6 million to $34.6 million, with a margin of approximately 27%.
* O'Brien said, "We are raising our adjusted EBITDA outlook and expect full year adjusted EBITDA of $148.2 million to $149.2 million, representing 29% adjusted EBITDA margin."
* The company reiterated its expectation for CapEx to be about 6% of total revenue for 2025, and unlevered free cash flow to be approximately $96 million to $98 million.

FINANCIAL RESULTS

* Total ARR for Q3 was $528.1 million, with constant currency year-over-year ARR growth accelerating for the second consecutive quarter. Total revenue was $131.7 million, representing approximately 13% year-over-year growth. Subscription revenue reached $130.5 million.
* The company reported 2,611 customers contributing $50,000 or more of ARR, up 15% year-over-year. These customers now represent about 61% of total ARR.
* Dollar-based net revenue retention was approximately 102%. Gross margin for the quarter was 81.1%. Adjusted EBITDA was $41.4 million, representing a 31.4% margin. Unlevered free cash flow was $22.6 million. Non-GAAP earnings per share was $0.13.
* Approximately 45% of revenue was generated outside of North America.

Q&A

* Dan Bergstrom, RBC Capital Markets, asked about the acceleration in ARR and the momentum behind it. O'Brien responded, attributing it to "executing around the thesis of the Albumin acquisition" and broadening the channel presence, stating, "We've been bearing fruit from both of those kind of strategic initiatives internally."
* Matt Calitri, Needham & Company, asked about NRR trends. O'Brien said, "Confidence is high that it bottomed in the first quarter and has continued to build as we've gone through the year," referencing cross-sell execution and improved gross retention.
* Calitri also inquired about new offerings like Anomaly Detection as a Service. O'Brien explained, "The really cool part about the anomaly detection is it really helps us transition our Cove data protection to not just the recovery, but actually part of the detection spots," and added this would help with win rates and monetization.
* Joe Vandrick, Scotiabank, asked about the Adlumin acquisition’s performance. Pagliuca said, "The story is resonating with our MSPs with the small shops, with the large shops... we're adding hundreds of end customers at the SMB level."
* Vandrick asked about investment in AI and EBITDA margins. Pagliuca responded, "We are investing in AI.... Our focus right now is to realize some of that opportunity that we believe is here and now."

SENTIMENT ANALYSIS

* Analysts focused on growth momentum and new offerings, expressing positive curiosity and seeking clarity on sustainability. Questions were constructive and forward-looking.
* Management maintained a confident and upbeat tone, emphasizing strategic execution and recurring improvements, while highlighting AI as a transformative opportunity. Statements like "confidence is high" and "we are creating that future now" reinforced this outlook.
* Compared to last quarter, both analysts and management displayed increased optimism about the sustainability of ARR growth, cross-sell performance, and the impact of AI-driven offerings.

QUARTER-OVER-QUARTER COMPARISON

* The company raised both revenue and ARR guidance for the full year versus last quarter’s outlook. EBITDA margin guidance was also increased.
* Management’s tone shifted to even greater confidence this quarter, especially regarding AI investments and the performance of the Adlumin acquisition.
* Analysts’ questions evolved from baseline growth and contract renewal stability in Q2 to seeking details on ARR momentum, new product launches, and the impact of AI in Q3.
* Strategic focus shifted further toward embedding AI across the platform and monetizing new AI-driven services.
* Retention rates, ARR, and the number of large customers all improved quarter-over-quarter.

RISKS AND CONCERNS

* Management flagged the evolving cybersecurity threat landscape, emphasizing that "AI is intensifying the speed, sophistication and scale of threats, and the adversary has never been more dangerous."
* The company cited regulatory changes and increasing insurance standards as drivers of market activity but also as sources of risk.
* Seasonality and FX headwinds were noted, with O'Brien stating, "FX is weighing a bit into the equation."
* The impact of lapping the Adlumin acquisition was called out as a factor in sequential growth rates.

FINAL TAKEAWAY

N-able’s Q3 2025 earnings call highlighted broad-based growth, improved profitability, and a rising strategic focus on AI-driven cybersecurity solutions. Management raised full-year revenue, ARR, and adjusted EBITDA targets, attributing momentum to successful channel expansion, robust cross-sell execution, and innovative offerings like Anomaly Detection as a Service. The company emphasized its differentiated platform breadth, deepening customer relationships, and continued investment in AI as key paths to sustained outperformance in a rapidly evolving cyber threat landscape.

Read the full Earnings Call Transcript [https://seekingalpha.com/symbol/nabl/earnings/transcripts]

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