Shares in Rapid7 Inc. fell more than 8% in late trading today after the cybersecurity solutions provider reported mixed fourth-quarter results and fell short on its revenue outlook for the year ahead.

For the quarter that ended on Dec. 31, Rapid7 reported adjusted earnings per share of 48 cents, down from 72 cents in the same quarter of 2023, on revenue of $216.25 million, up 5% year-over-year. The company’s earnings fell short of the 50 cents per share expected by analysts, while the revenue figure was ahead of an expected $212.2 million.

Across its revenue lines, Rapid7 saw product subscription revenue rise 6% year-over-year, to $206.3 million, while professional services revenue fell 5%, to $9.9 million. Annual recurring revenue sat at $839.8 million as of the end of the quarter, up 4% year-over-year. The company added 201 new customers in the quarter, taking its total customer count to 11,727.

Rapid7’s business highlights in the quarter included expansions of its security offerings and integrations to enhance threat detection and response. In November, its Managed Extended Detection and Response service added coverage for Microsoft Corp.’s security telemetry, allowing organizations to integrate existing Microsoft data into Rapid7’s Command Platform without additional infrastructure or complex configurations.

Further strengthening its cloud security capabilities, Rapid7 expanded Exposure Command to support AWS Resource Control Policies, which is aimed at helping enterprises address identity and access management challenges. In December, the company added Amazon Web Services environment coverage to its managed extended detection and response service and achieved the “In Process” designation from the Federal Risk and Authorization Management Program.

For the full fiscal year 2024, Rapid7 reported adjusted earnings per share of $2.28, up from $1.52 in 2023, on revenue of $844 million, up 9% year-over-year.

“As we reflect on 2024, I’m proud of the progress we made to position Rapid7 for long-term growth and success,” Chief Executive Corey Thomas said in the company’s earnings release. “We achieved $840 million in ARR and delivered over $150 million in free cash flow while advancing our strategic priorities to innovate, scale and empower our customers to consolidate and secure their operations more effectively.”

“Continued momentum in managed detection and response and the launch of our Exposure Command platform have further strengthened our ability to deliver measurable value for customers,” Thomas added.

For its fiscal 2025 first quarter, Rapid7 expects adjusted earnings per share of 33 to 36 cents on revenue of $207 million to $209 million. For the full year, the company expects earnings per share of $1.72 to $1.85 on revenue of $860 million to $870 million.

The full-year outlook figures were both misses, falling short of the $2.37 per share and revenue of $886.25 million expected by analysts.

Photo: Rapid7