On24, Inc. ((ONTF)) has held its Q2 earnings call. Read on for the main highlights of the call.
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The recent earnings call for On24, Inc. painted a generally positive picture, highlighting strong revenue performance and customer growth, alongside positive cash flow and EBITDA. While the company acknowledged some challenges in ARR performance, which was slightly negative, they also noted expectations of a seasonal decline in Q3. Nevertheless, positive developments in AI adoption and enterprise metrics, coupled with strategic initiatives, are setting a solid foundation for future growth.
Exceeding Revenue Expectations
On24, Inc. reported total revenue of $35.3 million for Q2 2025, surpassing expectations. The core platform ARR reached $125.1 million, indicating robust financial health and effective revenue strategies.
Strong Customer Retention and Growth
The company achieved the highest in-period gross retention in four years, and the $100,000-plus ARR customer base expanded, showing significant traction in enterprise segments.
Positive Cash Flow and EBITDA
On24, Inc. achieved positive adjusted EBITDA and generated positive free cash flow for the sixth consecutive quarter, underscoring its financial stability and operational efficiency.
Product Innovation and AI Adoption
The adoption of AI-powered ACE solutions increased, with a mid-teens percentage of customers opting for the service, highlighting the company’s commitment to innovation and technological advancement.
Enterprise Customer Metrics
The average core ARR per customer reached approximately $80,000, marking the highest level ever reported, reflecting strong enterprise customer engagement and value.
ARR Performance
Despite improvements, ARR performance was marginally negative for the first half of 2025 compared to the same period last year, indicating areas for potential growth and enhancement.
Seasonal ARR Decline Expected
The company anticipates a seasonally softer Q3 for ARR, with core ARR expected to decline by $0.5 million to $1.5 million, aligning with historical seasonal trends.
Forward-Looking Guidance
During the earnings call, On24, Inc. provided guidance for the third quarter and full fiscal year. The company projected Q3 total revenue between $33.6 million and $34.2 million, with core platform revenue expected to range from $33.0 million to $33.6 million. For the full year 2025, they anticipate total revenue between $137.7 million and $138.7 million, with Professional Services comprising about 7.5% of total revenue. They forecast a non-GAAP operating loss between $5.2 million and $3.8 million and non-GAAP net income per share ranging from $0.02 to $0.05. Gross margins are expected to be 76% to 77% for the year, with aims to be adjusted EBITDA positive in Q4 and for the full year.
In conclusion, On24, Inc.’s earnings call reflected a positive sentiment overall, with strong revenue performance and customer growth. While there are challenges in ARR performance, the company’s strategic initiatives and focus on AI adoption provide a promising outlook for future growth. The guidance for the upcoming quarters suggests a cautious yet optimistic approach, with expectations of returning to positive ARR growth by Q4.