NABL — N-able, Inc.

N-able Q4 2025 Earnings Call Summary

1. Key Financial Results and Metrics

• Revenue: Q4 revenue reached $130 million, exceeding guidance by $3 million, representing a 12% year-over-year increase (9% in constant currency). Full-year revenue totaled $511 million, up 10% year-over-year.
• Annual Recurring Revenue (ARR): Ended Q4 with $540 million in ARR, growing 12% year-over-year (8% in constant currency).
• Adjusted EBITDA: Q4 adjusted EBITDA was $39 million (30% margin), with a full-year total of $153 million (30% margin).
• Customer Growth: 2,671 customers contributed $50,000+ in ARR, up 14% year-over-year, representing 61% of total ARR.
• Dollar-Based Net Revenue Retention: Approximately 103% reported, 102% in constant currency.

2. Strategic Updates and Business Highlights

• AI Integration: N-able is embedding AI across its cybersecurity platform, enhancing efficiency and threat detection. The introduction of the AI workflow assistant "N-zo" aims to streamline IT operations for managed service providers (MSPs).
• Acquisition of Adlumin: Successfully integrated, contributing positively to revenue and cross-selling opportunities, particularly in the MSP community.
• New Product Initiatives: Plans to launch Disaster Recovery as a Service (DRaaS) and Google Workspace workload coverage to expand market reach.
• Channel Expansion: Increased focus on VAR partnerships to enhance sales and market penetration, particularly in unified endpoint management (UEM).

3. Forward Guidance and Outlook

• Q1 2026 Guidance: Expected revenue of $131 million to $132 million (11% to 12% growth), with adjusted EBITDA of $35.5 million to $36.5 million (27% to 28% margin).
• Full Year 2026 Guidance: Anticipated total revenue of $554 million to $559 million (8% to 9% growth), with ARR projected at $581 million to $586 million (8% to 9% growth). Full-year adjusted EBITDA expected to be $167 million to $171 million (30% to 31% margin).
• Investment Focus: Continued investment in AI and product innovation while improving unlevered free cash flow, projected at $114 million to $118 million for 2026.

4. Bad News, Challenges, or Points of Concern

• Gross Margin Decline: Q4 gross margin was 80%, down from 82% year-over-year; full-year gross margin decreased to 81% from 84%.
• Debt Management: N-able refinanced its credit facility, increasing its commitment to $400 million, which may raise concerns about leverage (net leverage at approximately 1.9x).
• Market Competition: The evolving landscape of AI and cybersecurity poses risks, as competitors may also enhance their offerings, potentially impacting N-able's market share.

5. Notable Q&A Insights

• Confidence in 2026 Guidance: Management expressed confidence in achieving higher constant currency ARR growth due to steady retention, new product traction, and enhanced VAR reach.
• Adlumin Acquisition Success: The cross-sell performance has exceeded expectations, driven by strong demand for AI solutions and compliance needs among MSPs.
• Seasonality in Revenue Growth: Expected seasonality similar to 2025, with stronger growth anticipated in the second half of 2026 as new products gain traction.
• AI Monetization Potential: Management indicated that AI could enhance the economic stack per MSP, with plans for AI-specific SKUs to further drive revenue growth.

Overall, N-able demonstrated solid financial performance in Q4 2025, with strategic initiatives focused on AI integration and channel expansion, while maintaining a cautious outlook on market competition and margin pressures.