In movies, hackers often target government organizations or critical pieces of infrastructure in pursuit of riches -- or to make some sort of bold political statement. While that happens in real life, the cybersecurity landscape is certainly different from those ambitious on-screen thrillers. This year has taught us that nobody is safe, and our largest companies have become digital piñatas for bad guys seeking economic gain.
Cyberattacks have become so sophisticated that predicting them can be almost impossible. The government even set up a public database filled with hundreds of thousands of known threats to help organizations protect themselves. But vulnerability management specialists Rapid7 (RPD 2.36%) and Tenable Holdings (TENB 4.38%) deliver solutions that can actively locate weaknesses in both local and cloud networks to keep malicious activity at bay.
Their services are in high demand from our most prized Fortune 500 companies, and they've both delivered second-quarter results that suggest business will only be getting better.
1. Rapid7
Rapid7 is trusted by organizations in over 140 countries. There isn't a single industry today that doesn't have some sort of online presence, and as remote work drives more operations into the cloud, protection is more important than ever.
Image source: Getty Images
It offers organizations real-time vulnerability management tools that act as a preventative layer of security. They're part of the company's Insight Platform, which is a suite of products focused on threat detection and visibility within internal networks, and in the cloud.
|
Metric |
Q2 2020 |
Q2 2021 |
Change |
|---|---|---|---|
|
Revenue |
$98.9 million |
$126.4 million |
28% |
|
Total customers |
8,223 |
9,315 |
13% |
Data source: Rapid7.
In addition to strong quarterly revenue growth, the company grew annualized recurring revenue by 29% to $488.9 million. And not only did it add 1,092 new customers, but the average amount of revenue earned from each customer increased by 14%, which is a formula for powerful growth going forward.
Rapid7 is also expanding its business through acquisitions. In July it closed a deal to buy IntSights Cyber Intelligence, a leading cybersecurity threat intelligence provider that will extend the capabilities of the company's Insight platform.
The company expects to deliver 2021 full-year revenue of up to $524 million, representing 27% growth compared to 2020 and above what analysts are predicting. Analysts also anticipate Rapid7 will generate a small profit of $0.01 per share after making a loss last year -- with profits ramping up further in 2022.
2. Tenable Holdings
Tenable is the creator of Nessus, a freemium vulnerability management tool that is ranked No. 1 globally in almost every category, including common vulnerabilities and exposures and vulnerability management. The free version is not a holistic security solution, but can be used to scan a network for vulnerabilities and is also programmable.
Image source: Getty Images
It has over 2.5 million downloads worldwide, is used within 30,000 organizations, and has the broadest coverage of the government-issued common vulnerabilities and exposures. Of the 167,000 on the list, it has solutions for over 64,000 of them -- more than any of its competitors.
Most notably, when Tenable's enterprise software detects a threat, it resolves it in a median time of under 24 hours, the fastest in the industry.
|
Metric |
Q2 2020 |
Q2 2021 |
Change |
|---|---|---|---|
|
Revenue |
$107.2 million |
$130.2 million |
22% |
|
Six-figure customers |
715 |
933 |
30% |
Data source: Tenable Holdings.
Tenable added 490 new enterprise customers in Q2 (with a $5,000 minimum spend) compared to 341 in the same quarter last year. But more importantly, it increased its base of customers who spend $100,000 or more annually by 30% to 933. Similarly to Rapid7, Tenable is quickly gaining new clients plus capturing increased expenditure, highlighting the corporate sector's growing need for cybersecurity.
The company generated an 18% increase in gross profit year over year, but continues to take net losses while it scales its business. Its largest rise in costs occurred in sales and marketing, reflecting its focus on customer acquisition.
However, analysts expect Tenable to deliver a full-year profit of $0.27 per share, followed by 44% growth in 2022. The company's revenue forecast of up to $531 million in 2021 is aligned with analyst estimates.
Since the stock is down 19% year to date, it could be a great opportunity to add this name to your portfolio for the long term, especially since cybersecurity demand is likely to increase for the foreseeable future.
