Rapid7 (RPD) Q1 2026 results, ARR update and full-year guidance
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Rapid7, Inc. reported first quarter 2026 results and issued guidance for 2026. Total revenue was $209.7 million, down 0.3% year-over-year, with product subscriptions revenue of $204.0 million, up slightly. Annualized recurring revenue was $832 million, a 0.6% decline.
GAAP loss from operations was $0.6 million, while non-GAAP income from operations was $24.4 million. GAAP net income was $1.1 million, or $0.02 per diluted share, and non-GAAP net income was $26.6 million, or $0.36 per diluted share. Free cash flow was $33.4 million and cash, cash equivalents and government securities totaled $670 million as of March 31, 2026.
For the second quarter 2026, Rapid7 expects revenue of $207–$209 million and non-GAAP income from operations of $24–$26 million. For full-year 2026, it guides to revenue of $836–$842 million, non-GAAP diluted EPS of $1.52–$1.60 and free cash flow of $125–$135 million.
Positive
- None.
Negative
- None.
8-K Event Classification
2 items: 2.02, 9.01
2 items
Item 2.02
Results of Operations and Financial Condition
Financial
Disclosure of earnings results, typically an earnings press release or preliminary financials.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Total revenue: $209.7 million
Annualized recurring revenue: $832 million
GAAP net income: $1.1 million
+5 more
8 metrics
Total revenue
$209.7 million
Three months ended March 31, 2026
Annualized recurring revenue
$832 million
As of March 31, 2026; down 0.6% year-over-year
GAAP net income
$1.1 million
Q1 2026, $0.02 per diluted share
Non-GAAP net income
$26.6 million
Q1 2026, $0.36 per diluted share
Free cash flow
$33.4 million
Three months ended March 31, 2026
Cash and investments
$670 million
Cash, cash equivalents and government securities as of March 31, 2026
2026 revenue guidance
$836–$842 million
Full-year 2026 outlook
2026 non-GAAP EPS guidance
$1.52–$1.60
Full-year 2026, diluted basis
Key Terms
Annualized recurring revenue, free cash flow, non-GAAP operating income, Adjusted EBITDA, +2 more
6 terms
Annualized recurring revenue financial
"Annualized recurring revenue of $832 million, a decrease of 0.6% year-over-year."
Annualized recurring revenue is the predictable income a business expects to earn over a year from ongoing customer subscriptions or contracts. It’s similar to estimating how much money you would make in a year if your current monthly income stayed the same. Investors use this figure to assess the stability and growth potential of a company's revenue stream.
free cash flow financial
"Net cash provided by operating activities of $39.8 million and free cash flow of $33.4 million."
Free cash flow is the amount of money a company has left over after paying all its expenses and investing in its business, like buying equipment or updating facilities. It shows how much cash is available to reward shareholders, pay down debt, or save for future growth. This helps investors understand if a company is financially healthy and able to grow.
non-GAAP operating income financial
"GAAP loss from operations of $0.6 million; Non-GAAP operating income of $24.4 million."
Non-GAAP operating income is a measure of a company's profit from its core business activities, calculated by excluding certain expenses or income that are not part of regular operations. It provides a clearer picture of how well the business is performing by focusing on ongoing operations, helping investors compare companies more consistently and make better-informed decisions.
Adjusted EBITDA financial
"Adjusted EBITDA is a non-GAAP measure that we define as net income (loss) before"
Adjusted EBITDA is a way companies measure how much money they make from their core operations, like running a business, by removing certain costs or income that aren’t part of regular business activities. It helps investors see how well a company is doing without distractions from unusual expenses or gains, making it easier to compare companies or track performance over time.
convertible senior notes financial
"We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes."
Convertible senior notes are a type of loan that a company issues to investors, which can be turned into company shares later on. They are called "senior" because they are paid back before other debts if the company runs into trouble. This allows investors to earn interest like a loan but also have the chance to own part of the company if its value rises.
Data Security Posture Management (DSPM) technical
"introducing runtime validation and Data Security Posture Management (DSPM) to enable organizations to identify, validate, and prioritize risks"
Data security posture management (DSPM) is an ongoing process and set of tools that finds where sensitive data lives, checks how well it is protected, and highlights gaps or risky settings across cloud and on‑premises systems. Think of it as a continuous security health check and map that helps prevent data leaks and compliance lapses. For investors, stronger DSPM reduces the chance of costly breaches, regulatory fines, and reputation damage that can hurt a company’s earnings and stock value.
Earnings Snapshot
Revenue: $209.7 million · Guidance included
Q1 2026
Revenue
$209.7 million
-0.3% year-over-year
ARR
$832 million
-0.6% year-over-year
GAAP net income
$1.1 million
Non-GAAP net income
$26.6 million
Free cash flow
$33.4 million
Guidance
For Q2 2026, Rapid7 expects ARR of approximately $820 million, revenue of $207–$209 million, non-GAAP operating income of $24–$26 million and non-GAAP diluted EPS of $0.33–$0.36. For full-year 2026, it guides to revenue of $836–$842 million, non-GAAP diluted EPS of $1.52–$1.60 and free cash flow of $125–$135 million.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 5, 2026
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation) | (Commission File Number) | (IRS Employer Identification No.) | ||||||||||||
| (Address of principal executive offices), including zip code | |||||||||||
(617 ) 247-1717
(Registrant’s telephone number, including area code)
Not Applicable
(Former name, or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
| Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |||||
| Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |||||
| Securities registered pursuant to Section 12(b) of the Securities Exchange Act of 1934: | ||||||||
| Title of each class | Trading symbol(s) | Name of each exchange on which registered | ||||||
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 2.02 | Results of Operations and Financial Condition. | ||||
On May 5, 2026 , Rapid7, Inc. (the “Company”) issued a press release announcing its financial results for the fiscal quarter ended March 31, 2026. The Company’s press release is furnished as Exhibit 99.1 to this Current Report on Form 8-K.
The information included in this Item 2.02 and in the accompanying Exhibit 99.1 shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, regardless of any general incorporation language in such filing.
| Item 9.01 | Financial Statements and Exhibits. | ||||
(d)Exhibits
| Exhibit No. | Description | |||||||
| 99.1 | Press Release, dated as of May 5, 2026. | |||||||
| 104 | Cover Page Interactive Data File (embedded within the inline XBRL document) | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Rapid7, Inc. | ||||||||||||||||||||
Dated: | By: | /s/ Rafeal E. Brown | ||||||||||||||||||
| Rafeal E. Brown | ||||||||||||||||||||
| Chief Financial Officer | ||||||||||||||||||||
Exhibit 99.1
Rapid7 Announces First Quarter 2026 Financial Results
•Annualized recurring revenue (“ARR”) of $832 million
•Total revenue of $210 million; Product subscriptions revenue of $204 million
•GAAP loss from operations of $0.6 million; Non-GAAP operating income of $24 million
•Net cash provided by operating activities of $40 million; Free cash flow of $33 million
Boston, MA – May 5, 2026 – Rapid7, Inc. (Nasdaq: RPD), a global leader in AI-powered managed cybersecurity operations, today announced its financial results for the first quarter 2026.
"As frontier models reshape the cybersecurity landscape, Rapid7's AI SOC and preemptive security infrastructure are more essential than ever," said Corey Thomas, CEO of Rapid7. "Our Exposure Management and Detection and Response capabilities are increasingly important to customers facing a groundswell of new vulnerabilities and attacks. And Rapid7's business is well positioned to meet that demand."
“During the first quarter, Rapid7 exceeded guidance expectations across all metrics and delivered strong free cash flow,” said Rafe Brown, CFO of Rapid7. “Anchored around our accelerated strategy to deliver the AI SOC capabilities customers need, we are focused on growing our Managed Detection and Response business while improving margins over the medium-term.”
First Quarter 2026 Financial Highlights
•Revenue: Total revenue of $210 million a decrease of 0.3% year-over-year. Product revenue of $204 million an increase of 0.1% year-over-year.
•ARR: Annualized recurring revenue of $832 million, a decrease of 0.6% year-over-year.
•Operating Income: GAAP loss from operations of $0.6 million; Non-GAAP operating income of $24.4 million.
•Net Income: GAAP net income of $1.1 million or $0.02 per diluted share and non-GAAP net income of $26.6 million or $0.36 per diluted share.
•Cash Flow: Net cash provided by operating activities of $39.8 million and free cash flow of $33.4 million.
•Total cash, cash equivalents, and government securities of $670 million as of March 31, 2026.
Recent Business Highlights
•In March, Rapid7 announced the acquisition of Kenzo Security, an agentic AI security platform built to scale security investigations autonomously, to accelerate its preemptive, AI-powered security operations, further integrating automated risk prioritization and remediation into its Command Platform.
•In March, Rapid7 released its 2026 Global Threat Landscape Report, revealing a 105% surge in the exploitation of high and critical-severity vulnerabilities as attack timelines continue to collapse.
•In March, Rapid7 expanded its Exposure Command platform with new cloud security capabilities, introducing runtime validation and Data Security Posture Management (DSPM) to enable organizations to identify, validate, and prioritize risks based on actual exploitability.
•In March, Rapid7 Labs published breakthrough research identifying sleeper cells embedded in global telecommunications networks by a state-sponsored actor with implications for government communications and critical systems. Alongside the research, Rapid7 released a free, open-source scanning script to support defenders.
•In March, Rapid7 launched updates to its PACT Partner Program, introducing a new Platinum tier and streamlined deal motions to drive partner-led growth for its Managed Detection and Response (MDR) services.
•In February, Rapid7 hosted its 2026 Partner of the Year Awards, recognizing top-performing partners for their excellence in delivering outcomes and scaling security practices within the Rapid7 ecosystem
rapid7.com 1
Second Quarter and Full Year 2026 Guidance
Non-GAAP guidance excludes estimates for stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs, and certain other items such as acquisition-related expenses, impairment of long-lived assets, restructuring expense, induced conversion expense, change in the fair value of derivative assets, non-ordinary course litigation-related expenses and discrete tax items. Rapid7 has provided a reconciliation of each non-GAAP guidance measure to the most comparable GAAP measures in the financial statement tables included in this press release. The reconciliation does not reflect any items that are unknown at this time, including, but not limited to, non-ordinary course litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty.
Rapid7 anticipates ARR, revenue, non-GAAP income from operations, non-GAAP net income per share and free cash flow to be in the following ranges:
| Second Quarter 2026 | Full-Year 2026 | ||||||||||||||||||||||
| (in millions, except per share data) | |||||||||||||||||||||||
| ARR | Approximately $820 million | Not provided | |||||||||||||||||||||
| Year-over-year growth | (2)% | Not provided | |||||||||||||||||||||
| Revenue | $207 | to | $209 | $836 | to | $842 | |||||||||||||||||
| Year-over-year growth | (3)% | to | (2)% | (3)% | to | (2)% | |||||||||||||||||
| Non-GAAP income from operations | $24 | to | $26 | $112 | to | $118 | |||||||||||||||||
| Non-GAAP net income per share, diluted | $0.33 | to | $0.36 | $1.52 | to | $1.60 | |||||||||||||||||
| Weighted average shares used in non-GAAP earnings per share calculation, diluted | 78.3 | 79.4 | |||||||||||||||||||||
| Free cash flow | Not provided | $125 | to | $135 | |||||||||||||||||||
The guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below. Guidance for the second quarter 2026 and full-year 2026 does not include any potential impact of foreign exchange gains or losses.
Conference Call and Webcast Information
Rapid7 will host a conference call today, May 5, 2026, to discuss its results at 4:30 p.m. Eastern Time. The call will be available live via webcast on Rapid7's website at https://investors.rapid7.com. A webcast replay of the conference call will be available at https://investors.rapid7.com.
About Rapid7
Rapid7, Inc. (NASDAQ: RPD) is a global leader in AI-powered managed cybersecurity operations, trusted to advance organizations’ cyber resilience. Open and extensible, the Rapid7 Command Platform integrates security data, enriching it with AI, threat intelligence, and 25 years of expertise and innovation to reduce risk and disrupt attackers. As a recognized leader in preemptive managed detection and response (MDR), Rapid7 unifies exposure and detection to transform the cybersecurity operations of more than 11,500 customers worldwide. For more information, visit our website, check out our blog, or follow us on LinkedIn or X.
Non-GAAP Financial Measures and Other Metrics
To supplement our consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we provide investors with certain non-GAAP financial measures and other metrics, which we believe are helpful to our investors. We use these non-GAAP financial measures and other metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We also use certain non-GAAP financial measures as performance measures under our executive bonus plan. We believe that these non-GAAP financial measures and other metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.
While our non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, you should review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate our business.
rapid7.com 2
Non-GAAP Financial Measures
We disclose the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share, adjusted EBITDA and free cash flow. We also disclose non-GAAP gross margin and non-GAAP operating margin derived from these financial measures.
We define non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share as the respective GAAP balances excluding the effect of stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs and certain other items such as acquisition-related expenses, impairment of long-lived assets, change in the fair value of derivative assets, restructuring expense, induced conversion expense and discrete tax items. Non-GAAP net income per basic and diluted share is calculated as non-GAAP net income divided by the weighted average shares used to compute net income per share, with the number of weighted average shares decreased, when applicable, to reflect the anti-dilutive impact of the capped call transactions entered into in connection with our convertible senior notes.
We believe these non-GAAP financial measures are useful to investors in assessing our operating performance due to the following factors:
Stock-based compensation expense. We exclude stock-based compensation expense because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact our non-cash expense. We believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between our operating results from period to period.
Amortization of acquired intangible assets. We believe that excluding the impact of amortization of acquired intangible assets allows for more meaningful comparisons between operating results from period to period as the intangible assets are valued at the time of acquisition and are amortized over several years after the acquisition.
Amortization of debt issuance costs. The expense for the amortization of debt issuance costs related to our convertible senior notes and our former revolving credit facility is a non-cash item, and we believe the exclusion of this interest expense provides a more useful comparison of our operational performance in different periods.
Acquisition-related expenses. We exclude acquisition-related expenses, including accretion expense associated with contingent consideration, as costs that are unrelated to the current operations and are neither comparable to the prior period nor predictive of future results.
Discrete tax items. We exclude certain discrete tax items such as income tax expenses or benefits that are not related to ongoing business operations in the current year and adjustments to uncertain tax position reserves as these charges are not indicative of our ongoing operating results, and they are not considered when we are forecasting our future results.
Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure that we define as net income (loss) before (1) interest income, (2) interest expense, (3) other (income) expense, net, (4) provision for income taxes, (5) depreciation expense, (6) amortization of intangible assets, (7) stock-based compensation expense, (8) acquisition-related expenses, and (9) discrete tax benefit. We believe that the use of adjusted EBITDA is useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods.
Free Cash Flow. Free cash flow is a non-GAAP measure that we define as cash provided by operating activities less purchases of property and equipment and capitalization of internal-use software costs. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after necessary capital expenditures.
We include all non-GAAP financial measures in the current year or any comparative year that will be included in the non-GAAP reconciliation during the current fiscal year annual Form 10-K. As such, not all non-GAAP financial measures listed above may be included in the current reporting period non-GAAP reconciliation in the GAAP to Non-GAAP Reconciliation section below.
Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact upon our reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in our business and an important part of the compensation provided to our employees.
rapid7.com 3
Other Metrics
ARR. Annualized Recurring Revenue and Growth. ARR is defined as the annual value of all recurring revenue related to active contracts as of the last day of the period. ARR is measured at a specific point in time and does not incorporate consideration of any anticipated contract terminations or other prospective events, regardless of whether such events may exert a favorable or adverse influence on the metric. ARR should be viewed independently of revenue and deferred revenue, as ARR is an operating metric and is not intended to be combined with or replace these items. ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates and does not include revenue reported as professional services revenue in our consolidated statement of operations. We use ARR and believe it is useful to investors as a measure of the overall success of our business.
Number of Customers. We define a customer as any entity that has an active Rapid7 recurring revenue contract as of the specified measurement date, excluding only InsightOps and Logentries customers with a contract value less than $2,400 per year.
ARR per Customer. We define ARR per customer as ARR divided by the number of customers at the end of the period.
Cautionary Language Concerning Forward-Looking Statements
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, the statements regarding our financial guidance for the second quarter and full-year 2026, and the assumptions underlying such guidance. Our use of the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. The events described in our forward-looking statements are subject to a number of risks and uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Such forward-looking statements are based on our current assumptions, expectations and estimates and involve a number of judgments and risks, many of which are outside of our control. Risks that could cause or contribute to such differences include, but are not limited to, macroeconomic uncertainty, unstable market and economic conditions, fluctuations in our quarterly results, our ability to successfully grow our sales of our cloud-based solutions, including through the shift to a consolidated platform sales approach, failure to meet our publicly announced guidance or other expectations about our business, our ability to grow our revenue, the ability of our products and professional services to correctly detect vulnerabilities, renewal of our customer's subscriptions, competition in the markets in which we operate, market growth, our ability to innovate, our sales cycles, our ability to successfully develop, deploy and realize the expected benefits of our artificial intelligence and automation capabilities, including risks related to performance, reliability, security and customer adoption of such technologies, our ability to successfully integrate acquired companies, including Kenzo Security, and achieve the expected synergies and benefits of such acquisitions in a timely manner or at all, exposure to greater than anticipated tax liabilities, our ability to operate in compliance with applicable laws, fluctuations in foreign currency exchange rates and their impact on our results, risks related to the accuracy, efficacy and perceived reliability of our threat intelligence, detection and response capabilities, including the potential for undetected vulnerabilities, false positives or failures in our systems, as well as other risks and uncertainties that could affect our business and results described in our filings with the Securities and Exchange Commission (the “SEC”), including our most recent Annual Report on Form 10-K filed with the SEC on February 19, 2026, particularly in the section entitled "Item 1.A Risk Factors," and in the subsequent reports that we file with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed in any forward-looking statements we may make. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release
###
| Investor contact: | Press contact: | |||||||
| Matthew Wells | Alice Randall | |||||||
| VP, Investor Relations | Director, Global Corporate Communications | |||||||
| investors@rapid7.com | press@rapid7.com | |||||||
| (617) 865-4277 | (214) 693-4727 | |||||||
rapid7.com 4
RAPID7, INC.
Condensed Consolidated Balance Sheets (Unaudited)
(in thousands)
| March 31, 2026 | December 31, 2025 | |||||||||||||
| Assets | ||||||||||||||
| Current assets | ||||||||||||||
| Cash and cash equivalents | $ | 343,291 | $ | 246,664 | ||||||||||
| Short-term investments | 326,967 | 228,006 | ||||||||||||
| Accounts receivable, net | 135,128 | 167,017 | ||||||||||||
| Deferred contract acquisition and fulfillment costs, current portion | 47,342 | 48,370 | ||||||||||||
| Prepaid expenses and other current assets | 47,617 | 47,230 | ||||||||||||
| Total current assets | 900,345 | 737,287 | ||||||||||||
| Long-term investments | — | 184,119 | ||||||||||||
| Property and equipment, net | 30,492 | 31,990 | ||||||||||||
| Operating lease right-of-use assets | 44,250 | 45,485 | ||||||||||||
| Deferred contract acquisition and fulfillment costs, non-current portion | 65,554 | 66,978 | ||||||||||||
| Goodwill | 593,334 | 575,268 | ||||||||||||
| Intangible assets, net | 67,567 | 65,105 | ||||||||||||
| Other assets | 18,101 | 20,232 | ||||||||||||
| Total assets | $ | 1,719,643 | $ | 1,726,464 | ||||||||||
| Liabilities and Stockholders’ Equity | ||||||||||||||
| Current liabilities | ||||||||||||||
| Accounts payable | $ | 12,304 | $ | 11,041 | ||||||||||
| Accrued expenses | 84,407 | 96,998 | ||||||||||||
| Convertible senior notes, current portion, net | 597,574 | — | ||||||||||||
| Operating lease liabilities, current portion | 17,964 | 16,176 | ||||||||||||
| Deferred revenue, current portion | 442,260 | 451,155 | ||||||||||||
| Total current liabilities | 1,154,509 | 575,370 | ||||||||||||
| Convertible senior notes, non-current portion, net | 295,666 | 892,284 | ||||||||||||
| Operating lease liabilities, non-current portion | 53,987 | 59,908 | ||||||||||||
| Deferred revenue, non-current portion | 28,417 | 29,971 | ||||||||||||
| Other long-term liabilities | 12,292 | 14,201 | ||||||||||||
| Total liabilities | 1,544,871 | 1,571,734 | ||||||||||||
| Stockholders' equity: | ||||||||||||||
| Common stock | $ | 667 | $ | 658 | ||||||||||
| Treasury stock | (4,765) | (4,765) | ||||||||||||
| Additional paid-in capital | 1,142,304 | 1,120,963 | ||||||||||||
| Accumulated other comprehensive income | 89 | 2,527 | ||||||||||||
| Accumulated deficit | (963,523) | (964,653) | ||||||||||||
| Total stockholders equity | 174,772 | 154,730 | ||||||||||||
| Total liabilities and stockholders’ equity | $ | 1,719,643 | $ | 1,726,464 | ||||||||||
rapid7.com 5
RAPID7, INC.
Condensed Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per share data)
| Three Months Ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| Revenue: | ||||||||||||||
| Product subscriptions | $ | 204,049 | $ | 203,935 | ||||||||||
| Professional services | 5,642 | 6,318 | ||||||||||||
| Total revenue | 209,691 | 210,253 | ||||||||||||
| Cost of revenue: | ||||||||||||||
| Product subscriptions | 59,154 | 54,368 | ||||||||||||
| Professional services | 5,595 | 5,112 | ||||||||||||
| Total cost of revenue | 64,749 | 59,480 | ||||||||||||
| Total gross profit | 144,942 | 150,773 | ||||||||||||
| Operating expenses: | ||||||||||||||
| Research and development | 48,354 | 47,888 | ||||||||||||
| Sales and marketing | 78,934 | 79,400 | ||||||||||||
| General and administrative | 18,212 | 23,586 | ||||||||||||
| Total operating expenses | 145,500 | 150,874 | ||||||||||||
| Loss from operations | (558) | (101) | ||||||||||||
| Other income (expense), net: | ||||||||||||||
| Interest income | 5,612 | 5,758 | ||||||||||||
| Interest expense | (2,498) | (2,654) | ||||||||||||
| Other (expense) income, net | (726) | 1,802 | ||||||||||||
| Income before income taxes | 1,830 | 4,805 | ||||||||||||
| Provision for income taxes | 700 | 2,700 | ||||||||||||
| Net income | $ | 1,130 | $ | 2,105 | ||||||||||
| Net income per share, basic | $ | 0.02 | $ | 0.03 | ||||||||||
Net income per share, diluted(1) | $ | 0.02 | $ | 0.03 | ||||||||||
| Weighted average common shares outstanding, basic | 66,174,341 | 63,835,945 | ||||||||||||
| Weighted average common shares outstanding, diluted | 66,904,992 | 64,224,415 | ||||||||||||
(1) We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive. On an if-converted basis, for the three months ended March 31, 2026, the 2027 and 2029 Notes were anti-dilutive; for the three months ended March 31, 2025, the 2029 Notes, 2027 Notes and 2025 Notes were anti-dilutive.
rapid7.com 6
RAPID7, INC.
Condensed Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
| Three Months Ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| Cash flows from operating activities: | ||||||||||||||
| Net income | $ | 1,130 | $ | 2,105 | ||||||||||
| Adjustments to reconcile net income to net cash provided by operating activities: | ||||||||||||||
| Depreciation and amortization | 11,210 | 11,665 | ||||||||||||
| Amortization of debt issuance costs | 1,045 | 1,019 | ||||||||||||
| Stock-based compensation expense | 19,890 | 27,151 | ||||||||||||
| Deferred income taxes | (1,220) | — | ||||||||||||
| Other | 1,489 | (1,153) | ||||||||||||
| Changes in assets and liabilities: | ||||||||||||||
| Accounts receivable | 31,405 | 27,668 | ||||||||||||
| Deferred contract acquisition and fulfillment costs | 2,453 | 5,295 | ||||||||||||
| Prepaid expenses and other assets | 1,632 | (1,995) | ||||||||||||
| Accounts payable | 2,342 | (6,555) | ||||||||||||
| Accrued expenses | (14,753) | (20,325) | ||||||||||||
| Deferred revenue | (11,114) | (12,874) | ||||||||||||
| Other liabilities | (5,692) | (2,244) | ||||||||||||
| Net cash provided by operating activities | 39,817 | 29,757 | ||||||||||||
| Cash flows from investing activities: | ||||||||||||||
| Business acquisitions, net of cash acquired | (23,345) | — | ||||||||||||
| Purchases of property and equipment | (2,081) | (1,361) | ||||||||||||
| Capitalization of internal-use software | (4,319) | (3,719) | ||||||||||||
| Purchases of investments | — | (144,461) | ||||||||||||
| Sales and maturities of investments | 85,000 | 69,000 | ||||||||||||
| Other investing activities | — | 1,328 | ||||||||||||
| Net cash provided by (used in) investing activities | 55,255 | (79,213) | ||||||||||||
| Cash flows from financing activities: | ||||||||||||||
| Taxes paid related to net share settlement of equity awards | (255) | (1,303) | ||||||||||||
| Proceeds from employee stock purchase plan | 2,889 | 4,446 | ||||||||||||
| Proceeds from stock option exercises | — | 1,589 | ||||||||||||
| Net cash provided by financing activities | 2,634 | 4,732 | ||||||||||||
| Effect of exchange rate changes on cash, cash equivalents and restricted cash | (1,079) | 1,334 | ||||||||||||
| Net increase (decrease) in cash, cash equivalents and restricted cash | 96,627 | (43,390) | ||||||||||||
| Cash, cash equivalents and restricted cash, beginning of period | $ | 246,664 | $ | 342,101 | ||||||||||
| Cash, cash equivalents and restricted cash, end of period | $ | 343,291 | $ | 298,711 | ||||||||||
| Supplemental cash flow information: | ||||||||||||||
| Cash paid for interest on convertible senior notes | $ | 2,625 | $ | 1,571 | ||||||||||
| Cash paid for income taxes, net of refunds | 782 | 992 | ||||||||||||
| Reconciliation of cash, cash equivalents and restricted cash: | ||||||||||||||
| Cash and cash equivalents | 343,291 | 291,462 | ||||||||||||
| Restricted cash included in prepaid expenses and other current assets | — | 7,249 | ||||||||||||
| Total cash, cash equivalents and restricted cash | $ | 343,291 | $ | 298,711 | ||||||||||
rapid7.com 7
RAPID7, INC.
GAAP to Non-GAAP Reconciliation (Unaudited)
(in thousands, except share and per share data)
| Three Months Ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| GAAP total gross profit | $ | 144,942 | $ | 150,773 | ||||||||||
Add: Stock-based compensation expense(1) | 1,716 | 2,264 | ||||||||||||
Add: Amortization of acquired intangible assets(2) | 4,423 | 4,423 | ||||||||||||
| Non-GAAP total gross profit | $ | 151,081 | $ | 157,460 | ||||||||||
| Non-GAAP gross margin | 72 | % | 75 | % | ||||||||||
| GAAP gross profit – product subscriptions | $ | 144,895 | $ | 149,567 | ||||||||||
| Add: Stock-based compensation expense | 1,369 | 1,731 | ||||||||||||
| Add: Amortization of acquired intangible assets | 4,423 | 4,423 | ||||||||||||
| Non-GAAP gross profit – product subscriptions | $ | 150,687 | $ | 155,721 | ||||||||||
| Non-GAAP gross margin - product subscriptions | 74 | % | 76 | % | ||||||||||
| GAAP gross profit – professional services | $ | 47 | $ | 1,206 | ||||||||||
| Add: Stock-based compensation expense | 347 | 533 | ||||||||||||
| Non-GAAP gross profit – professional services | $ | 394 | $ | 1,739 | ||||||||||
| Non-GAAP gross margin - professional services | 7 | % | 28 | % | ||||||||||
| GAAP loss from operations | $ | (558) | $ | (101) | ||||||||||
Add: Stock-based compensation expense(1) | 19,890 | 27,151 | ||||||||||||
Add: Amortization of acquired intangible assets(2) | 4,494 | 5,120 | ||||||||||||
Add: Acquisition-related expenses(3) | 606 | 183 | ||||||||||||
| Non-GAAP income from operations | $ | 24,432 | $ | 32,353 | ||||||||||
| GAAP net income | $ | 1,130 | $ | 2,105 | ||||||||||
Add: Stock-based compensation expense(1) | 19,890 | 27,151 | ||||||||||||
Add: Amortization of acquired intangible assets(2) | 4,494 | 5,120 | ||||||||||||
| Add: Amortization of debt issuance costs | 1,045 | 1,019 | ||||||||||||
Add: Acquisition-related expenses(3) | 606 | 183 | ||||||||||||
Add: Discrete tax items(4) | (600) | — | ||||||||||||
| Non-GAAP net income | $ | 26,565 | $ | 35,578 | ||||||||||
Add: Interest expense of convertible senior notes(5) | 1,313 | 1,571 | ||||||||||||
| Numerator for non-GAAP earnings per share calculation | $ | 27,878 | $ | 37,149 | ||||||||||
| Weighted average shares used in GAAP earnings per share calculation, basic | 66,174,341 | 63,835,945 | ||||||||||||
Dilutive effect of convertible senior notes(5) | 10,429,891 | 11,183,611 | ||||||||||||
Dilutive effect of employee equity incentive plans(6) | 730,651 | 388,471 | ||||||||||||
| Weighted average shares used in non-GAAP earnings per share calculation, diluted | 77,334,883 | 75,408,027 | ||||||||||||
| Non-GAAP net income per share: | ||||||||||||||
| Basic | $ | 0.40 | $ | 0.56 | ||||||||||
| Diluted | $ | 0.36 | $ | 0.49 | ||||||||||
rapid7.com 8
(1) Includes stock-based compensation expense as follows: | ||||||||||||||
| Cost of revenue | $ | 1,716 | $ | 2,264 | ||||||||||
| Research and development | 8,406 | 10,386 | ||||||||||||
| Sales and marketing | 5,071 | 7,241 | ||||||||||||
| General and administrative | $ | 4,697 | $ | 7,260 | ||||||||||
(2) Includes amortization of acquired intangible assets as follows: | ||||||||||||||
| Cost of revenue | $ | 4,423 | $ | 4,423 | ||||||||||
| Sales and marketing | 71 | 652 | ||||||||||||
| General and administrative | $ | — | $ | 45 | ||||||||||
(3) Includes acquisition-related expenses as follows: | ||||||||||||||
| General and administrative | $ | 606 | $ | 183 | ||||||||||
(4) Includes discrete tax items as follows: | ||||||||||||||
| (Benefit) Provision for income taxes | $ | (600) | $ | — | ||||||||||
(5) We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive. | ||||||||||||||
(6) We use the treasury method to compute the dilutive effect of employee equity incentive awards. | ||||||||||||||
rapid7.com 9
RAPID7, INC.
Reconciliation of Net Income to Adjusted EBITDA (Unaudited)
(in thousands)
| Three Months Ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
GAAP net income | $ | 1,130 | $ | 2,105 | ||||||||||
| Interest income | (5,612) | (5,758) | ||||||||||||
| Interest expense | 2,498 | 2,654 | ||||||||||||
| Other expense (income), net | 726 | (1,802) | ||||||||||||
Provision for income taxes | 700 | 2,700 | ||||||||||||
| Depreciation expense | 2,374 | 2,791 | ||||||||||||
| Amortization of intangible assets | 8,836 | 8,874 | ||||||||||||
| Stock-based compensation expense | 19,890 | 27,151 | ||||||||||||
| Acquisition-related expenses | 606 | 183 | ||||||||||||
| Adjusted EBITDA | $ | 31,148 | $ | 38,898 | ||||||||||
RAPID7, INC.
Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow (Unaudited)
(in thousands)
| Three Months Ended March 31, | ||||||||||||||
| 2026 | 2025 | |||||||||||||
| Net cash provided by operating activities | $ | 39,817 | $ | 29,757 | ||||||||||
| Less: Purchases of property and equipment | (2,081) | (1,361) | ||||||||||||
| Less: Capitalized internal-use software costs | (4,319) | (3,719) | ||||||||||||
| Free cash flow | $ | 33,417 | $ | 24,677 | ||||||||||
rapid7.com 10
RAPID7, INC.
Reconciliation of Non-GAAP Guidance
(in millions, except per share data)
| Anticipated Second Quarter 2026 | Anticipated Full-Year 2026 | ||||||||||||||||||||||
| Low | High | Low | High | ||||||||||||||||||||
| GAAP income from operations | $ | 1 | to | $ | 3 | $ | 18 | to | $ | 24 | |||||||||||||
| Add: Stock-based compensation expense | 19 | to | 19 | 76 | to | 76 | |||||||||||||||||
| Add: Amortization of acquired intangible assets | 4 | to | 4 | 17 | to | 17 | |||||||||||||||||
| Add: Acquisition-related expenses | — | to | — | 1 | to | 1 | |||||||||||||||||
| Non-GAAP income from operations | $ | 24 | to | $ | 26 | $ | 112 | to | $ | 118 | |||||||||||||
| GAAP net income | $ | 1 | to | $ | 3 | $ | 19 | to | $ | 25 | |||||||||||||
| Add: Stock-based compensation expense | 19 | to | 19 | 76 | to | 76 | |||||||||||||||||
| Add: Amortization of acquired intangible assets | 4 | to | 4 | 17 | to | 17 | |||||||||||||||||
| Add: Amortization of debt issuance costs | 1 | to | 1 | 4 | to | 4 | |||||||||||||||||
| Add: Acquisition-related costs | — | to | — | 1 | to | 1 | |||||||||||||||||
| Less: Discrete tax item | — | to | — | $ | (1) | to | $ | (1) | |||||||||||||||
| Non-GAAP net income | $ | 25 | to | $ | 27 | $ | 116 | to | $ | 122 | |||||||||||||
| Add: Interest expense on convertible senior notes | 1 | to | 1 | 5 | to | 5 | |||||||||||||||||
| Numerator for non-GAAP earnings per share calculation | $ | 26 | to | $ | 28 | $ | 121 | to | $ | 127 | |||||||||||||
GAAP net income per share(1) | $ | 0.01 | to | $ | 0.04 | $ | 0.28 | to | $ | 0.37 | |||||||||||||
| Non-GAAP net income per share, diluted | $ | 0.33 | to | $ | 0.36 | $ | 1.52 | to | $ | 1.60 | |||||||||||||
| Weighted average shares used in non-GAAP earnings per share calculation, diluted | 78.3 | 79.4 | |||||||||||||||||||||
(1) The anticipated GAAP net loss per share is calculated using basic weighted average shares for periods in which the Company anticipated a GAAP net loss. The anticipated GAAP net income per share is calculated using GAAP diluted weighted average shares for periods in which the Company anticipated GAAP net income. | |||||||||||||||||||||||
The reconciliation does not reflect any items that are unknown at this time, including, but not limited to, non-ordinary course litigation-related expenses, which we are not able to predict without unreasonable effort due to their inherent uncertainty. As a result, the estimates shown for Anticipated GAAP loss from operations, Anticipated GAAP net loss and Anticipated GAAP net loss per share are expected to change.
| Full-Year 2026 | |||||||||||
| Low | High | ||||||||||
| Net cash provided by operating activities | $ | 149 | to | $ | 159 | ||||||
| Less: Purchases of property and equipment | (7) | to | (7) | ||||||||
| Less: Capitalized internal-use software costs | (17) | to | (17) | ||||||||
| Free cash flow | $ | 125 | $ | 135 | |||||||
rapid7.com 11
FAQ
How did Rapid7 (RPD) perform in the first quarter of 2026?
Rapid7 delivered total Q1 2026 revenue of $209.7 million, down 0.3% year-over-year. Annualized recurring revenue was $832 million, down 0.6%. The company reported GAAP net income of $1.1 million and non-GAAP net income of $26.6 million.
What were Rapid7’s profitability metrics for Q1 2026?
Rapid7 posted a small GAAP loss from operations of $0.6 million but generated non-GAAP operating income of $24.4 million. GAAP diluted EPS was $0.02, while non-GAAP diluted EPS reached $0.36, reflecting adjustments such as stock-based compensation.
How strong was Rapid7’s cash flow and liquidity in Q1 2026?
Rapid7 generated $39.8 million of net cash from operating activities and $33.4 million of free cash flow in Q1 2026. As of March 31, 2026, it held $670 million in cash, cash equivalents and government securities, providing substantial liquidity.
What guidance did Rapid7 (RPD) provide for Q2 2026?
For the second quarter 2026, Rapid7 anticipates ARR of approximately $820 million, revenue between $207 million and $209 million, non-GAAP operating income of $24–$26 million, and non-GAAP diluted EPS in the range of $0.33 to $0.36.
What is Rapid7’s full-year 2026 outlook for revenue and earnings?
For full-year 2026, Rapid7 expects revenue between $836 million and $842 million and non-GAAP income from operations of $112–$118 million. It guides to non-GAAP diluted EPS of $1.52 to $1.60 and free cash flow of $125–$135 million.
Did Rapid7 (RPD) generate free cash flow in Q1 2026?
Yes. Rapid7 reported Q1 2026 free cash flow of $33.4 million, calculated from $39.8 million of net cash provided by operating activities minus capital expenditures and capitalized internal-use software costs. This compares with $24.7 million of free cash flow in the prior-year quarter.
What major strategic actions did Rapid7 take recently?
Rapid7 announced the acquisition of Kenzo Security, an agentic AI security platform, to enhance its AI-powered operations. It also expanded its Exposure Command platform, released its 2026 Global Threat Landscape Report, and updated its PACT Partner Program to support MDR growth.