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Sep 30, 2023

JFrog Q3 2023 Earnings Report

JFrog exceeded guidance with solid performance, driven by enterprise adoption of its hybrid Software Supply Chain Platform and comprehensive security solutions.

Key Takeaways

JFrog reported a strong Q3 2023, exceeding the high end of its guidance. Total revenue reached $88.6 million, a 23% increase year-over-year, with cloud revenue growing by 46%. The company saw an increase in customers with ARR over $1 million, reaching 30, up 67% year-over-year.

Total revenue was $88.6 million, up 23% year-over-year.

Cloud revenue increased by 46% year-over-year, representing 35% of total revenue.

Customers with ARR over $1 million grew to 30, a 67% increase year-over-year.

Net Dollar Retention rate for the trailing four quarters was 119%.

Total Revenue
$88.6M
Previous year: $72M
+23.1%
EPS
$0.15
Previous year: $0.02
+650.0%
Gross Margin
77.7%
Previous year: 77.9%
-0.3%
Non-GAAP Gross Margin
83.7%
Previous year: 84.2%
-0.6%
Operating Margin
-20.4%
Previous year: -32.6%
-37.4%
Gross Profit
$68.9M
Previous year: $56.1M
+22.8%
Cash and Equivalents
$61M
Previous year: $54M
+13.0%
Free Cash Flow
$25.4M
Previous year: $3.82M
+564.3%
Total Assets
$920M
Previous year: $853M
+7.9%

JFrog

JFrog

Forward Guidance

JFrog anticipates revenue between $92.5 million and $93.5 million and non-GAAP operating income between $10.0 million and $11.0 million for Q4 2023. The company projects revenue between $345.1 million to $346.1 million and non-GAAP operating income between $32.8 million and $33.8 million for the full fiscal year 2023.

Positive Outlook

  • Revenue between $92.5 million and $93.5 million
  • Non-GAAP operating income between $10.0 million and $11.0 million
  • Non-GAAP net income per diluted share between $0.12 and $0.13, assuming approximately 111 million weighted average diluted shares outstanding
  • Revenue between $345.1 million to $346.1 million
  • Non-GAAP operating income between $32.8 million and $33.8 million

Challenges Ahead

  • Non-GAAP net income per diluted share between $0.44 and $0.45, assuming approximately 109 million weighted average diluted shares outstanding
  • Risks associated with managing rapid growth
  • History of losses
  • Limited operating history
  • Ability to retain and upgrade existing customers