JFrog's (NASDAQ:FROG) stock recently rose after the software repository provider posted its fourth-quarter numbers. Its revenue rose 39% year-over-year to $42.7 million, beating estimates by $1.2 million. Its adjusted net income dipped 11% to $2.2 million, or $0.02 per share, but still matched Wall Street's expectations.

For the full year, JFrog expects its revenue to rise 30%-35%, compared to expectations for 30% growth. Those headline numbers all look solid, but a deeper dive into its report reveals some even more impressive numbers.

Two developers work on a mobile app.

Image source: Getty Images.

1. 69% growth in cloud revenue

JFrog's core platform, Artifactory, is a universal repository that enables companies to automatically and continuously update their software. The platform can run on self-managed deployments or multi-cloud services.

JFrog's cloud-based business is more scalable and generates stronger growth than its self-managed business. During the fourth quarter, JFrog's cloud revenue rose 69% year-over-year and accounted for 23% of its top line, up from 19% a year earlier.

For the full year, its cloud revenue increased 71% and accounted for 22% of its top line, up from 18% in 2019. That expansion will ensure JFrog keeps pace with the secular shift toward public cloud services.

2. 6,050 customers

JFrog's customer base grew 8% to 6,050 in 2020. It ended the fourth quarter with 352 customers with annual recurring revenue (ARR) above $100,000 -- up from 313 in the third quarter, and marking its strongest sequential growth in five quarters. Within that total, ten customers had an ARR of over $1 million, up from nine in the previous quarter.

3. A net retention rate of 133%

In addition to securing new customers, JFrog is growing its revenue per existing customer, which is measured by its net retention rate. It posted a net retention rate of 133% over the past four quarters, which indicates that its customers spent 33% more money than in the previous year.

During the conference call, CEO Shlomi Ben Haim attributed JFrog's high retention rate to its sales team, which made sure that it retained its "customers at whatever cost it means, whatever engagement it requires, whatever level of support it requires." Ben Haim also reiterated JFrog's goal of keeping its net retention rate above 130% for the foreseeable future.

4. Rising gross margins

JFrog's adjusted gross margin rose year-over-year from 81.2% to 82.6% in the fourth quarter. For the full year, its adjusted gross margin increased from 82.2% to 82.4%.

CFO Jacob Schulman attributed that expansion to "significant investments in improving the efficiency of our operations, particularly in our cloud business."

Those stable margins also indicate JFrog still has plenty of pricing power against rivals like IBM's Red Hat, Amazon Web Services' (AWS) CodeArtifact, and Microsoft's Azure DevOps with GitHub, which all integrate similar repositories into their cloud services.

5. Stable operating margins

JFrog's adjusted operating margin dipped year-over-year from 7.4% to 5.1% in the fourth quarter, due to the ongoing investments in its platform, but rose from 5.7% to 8.6% for the full year.

During the call, Schulman said JFrog would retain a "low to mid-single digit" operating margin in the near future as it continues to "balance investments in growing the business and leveraging the opportunity in front of JFrog with profitability."

JFrog probably won't generate a GAAP profit anytime soon, but its improving margins should continue to boost its free cash flow -- which more than tripled to a record high of $25.9 million for the full year.

But is it the right time to buy JFrog?

Last November, I claimed JFrog's stock was too expensive relative to its growth. At $70, the stock trades at over 30 times this year's sales -- which indicates a lot of growth is still baked into its price.

JFrog's growth rates are impressive, but I'd only nibble on the stock at these levels. Investors who don't want to pay the wrong price for the right company might consider waiting for a market downturn before accumulating a bigger stake.