Here's our initial take on Cellebrite DI's (CLBT 2.65%) financial report.
Key Metrics
| Metric | Q2 2024 | Q2 2025 | Change | vs. Expectations |
|---|---|---|---|---|
| Total revenue | $95.7 million | $113.3 million | +18% | Beat |
| Adjusted earnings per share | $0.10 | $0.12 | +20% | Beat |
| Annualized recurring revenue | $345.9 million | $418.9 million | +21% | n/a |
| Free cash flow | $12.4 million | $29.0 million | +133% | n/a |
Cellebrite Moves Forward on Multiple Fronts
Cellebrite has enjoyed high demand for its digital investigative software, with both government entities and private-sector corporate clients adopting Cellebrite's platform extensively. Revenue for the second quarter was up 18% year over year, and annualized recurring revenue from the software-as-a-service platform climbed at a faster 21% rate. Earnings per share came in a penny better than expected as Cellebrite celebrated rising margins from its effectiveness in controlling costs and making the most of sales growth. A dollar-based net retention rate of 120% signaled that existing clients are making greater use of Cellebrite's services.
CEO Tom Hogan pointed to Cellebrite's plans to acquire virtualization technology specialist Corellium and its collaboration with the U.S. Department of Justice as important factors that could expand the scope of its business. The Corellium deal hasn't yet gotten final approval, though, so Cellebrite hasn't incorporated its potential impact into guidance.
As for Hogan, the once-interim CEO has formally been named to fill the role permanently. Cellebrite's board chair had kind words to say about Hogan's experience and leadership. Joining Hogan will be David Barter, who will take over the CFO role from the retiring Dana Gerner.
Immediate Market Reaction
Investors were generally pleased with Cellebrite's news. The stock moved higher by almost 5% in premarket trading during the first 45 minutes after the release of its financial report. Both sales and earnings were higher than most of those following Cellebrite had anticipated, which was likely the biggest contributor to the upward move.
Even so, it's important to put the modest move into context. Cellebrite's stock soared during late 2024 and into the beginning of 2025, but since their February peak, the shares had lost roughly half their value at their worst levels. Signs of a rebound are encouraging, though, and Cellebrite hopes that future results will validate investors' confidence.
What to Watch
Cellebrite's guidance for the third quarter and for the full 2025 year doesn't show a huge acceleration of sales growth. Annualized recurring revenue is likely to rise to between $435 million and $445 million next quarter and to between $460 million and $475 million by year-end. Third-quarter revenue of $121 million to $126 million would be 13% to 18% higher than in the year-ago period. Full-year 2025 sales of $465 million to $475 million would represent growth of 16% to 18%.
Those are all solid numbers. However, in some investors' eyes, they don't represent the full potential of Cellebrite's business. We look forward to seeing whether Hogan, in his permanent CEO role, can light a fire under Cellebrite and build further momentum toward a full recovery in the stock.
