A month has gone by since the last earnings report for CyberArk (CYBR). Shares have added about 10.1% in that time frame, outperforming the S&P 500.
But investors have to be wondering, will the recent positive trend continue leading up to its next earnings release, or is CyberArk due for a pullback? Well, first let's take a quick look at its latest earnings report in order to get a better handle on the recent drivers for CyberArk Software Ltd. before we dive into how investors and analysts have reacted as of late.
CyberArk Q2 Earnings & Revenues Beat Estimates
CyberArk Software Ltd. came out with quarterly earnings of $0.88 per share, beating the Zacks Consensus Estimate of $0.79 per share. This compares to earnings of $0.54 per share a year ago.
CyberArk posted revenues of $328.03 million for the quarter ended June 2025, surpassing the Zacks Consensus Estimate by 4.00%. This compares to year-ago revenues of $224.71 million.
CyberArk Q2 in Details
Segment-wise, Subscription revenues (80% of total revenues) were $263.8 million, up 66% year over year from $158.4 million. Maintenance, professional services and other revenues (20% of total) came in at $64.3 million, slightly lower than $66.3 million in the year-ago quarter.
CyberArk no longer reports perpetual license revenues separately, as these are now included in the Maintenance, Professional Services and Other line item.
On the profitability front, non-GAAP gross profit rose to $276 million, up from $186.9 million in the year-ago quarter, with non-GAAP gross margin expanding to 84.2%.
Non-GAAP operating income more than doubled to $49.4 million, translating to a 15% margin versus 11% a year earlier.
Non-GAAP net income was $45.6 million ($0.88 per diluted share), up from $26.1 million ($0.54) last year.
CyberArk’s Key Business Metrics
As of June 30, 2025, Annual Recurring Revenues (ARR) were $1.27 billion, up 46.8% year over year. The Subscription portion of ARR was $1.09 billion, or 85.4% of total ARR, as of June 30, 2025, up 60.7% year over year.
The Maintenance portion of ARR was $185 million as of June 30, 2025, down from $191 million on a year-over-year basis.
CyberArk’s Balance Sheet & Cash Flow
CyberArk ended the quarter with cash, cash equivalents, marketable securities and short-term deposits of $720.9 million as of June 30, 2025, compared with $776.1 million as of March 31, 2025. The sequential decline was mainly due to share repurchases and integration expenses related to the Zilla acquisition.
Long-term debt stood at $170.8 million as of June 30, 2025, roughly flat compared with $171.2 million at the end of the first quarter 2025.
During the second quarter 2025, CyberArk generated GAAP operating cash flow of $4.7 million. Free cash flow was negative $2.2 million, primarily impacted by a one-time $44 million tax payment tied to the Venafi IP migration. On an adjusted basis (excluding this one-time item), free cash flow came in at $44 million, representing a 13% margin.
CyberArk Initiates Q3 & Updates 2025 Guidance
For the third quarter of 2025, CyberArk expects revenues in the range of $329 million to $335 million. Non-GAAP operating income is projected between $45.5 million and $50.5 million, while non-GAAP earnings per share are anticipated in the range of 82 to 89 cents.
For full-year 2025, the company now expects revenues in the band of $1.34 billion to $1.35 billion, up from the prior guidance of $1.313 billion to $1.323 billion. Non-GAAP operating income is now forecast between $232 million and $240 million, compared with the previous range of $221 million to $229 million. Non-GAAP earnings per share are expected to come in between $3.96 and $4.08, up from the earlier guidance of $3.73 to $3.85.
CyberArk also expects ARR of $1.41 billion to $1.42 billion as of Dec. 31, 2025, representing approximately 21% year-over-year growth. The company continues to project adjusted free cash flow between $300 million and $310 million for the year
How Have Estimates Been Moving Since Then?
In the past month, investors have witnessed a downward trend in estimates review.
The consensus estimate has shifted 26.08% due to these changes.
VGM Scores
Currently, CyberArk has a average Growth Score of C, a score with the same score on the momentum front. However, the stock was allocated a grade of F on the value side, putting it in the fifth quintile for value investors.
Overall, the stock has an aggregate VGM Score of F. If you aren't focused on one strategy, this score is the one you should be interested in.
Outlook
Estimates have been broadly trending downward for the stock, and the magnitude of these revisions looks promising. It's no surprise CyberArk has a Zacks Rank #4 (Sell). We expect a below average return from the stock in the next few months.
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CyberArk Software Ltd. (CYBR): Free Stock Analysis ReportThis article originally published on Zacks Investment Research (zacks.com).
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