Shares in Rapid7 Inc. edged down slightly in late trading today despite the cybersecurity solutions provider reporting beats in revenue and earnings in its fiscal third quarter.

For the quarter ended Sept. 30, Rapid7 reported adjusted earnings per share of 66 cents, up from 56 cents in the same quarter of the previous fiscal year, on revenue of $214.65 million, up 8% year-over-year. Both figures were higher than the 52 cents per share and revenue of $210.1 million expected by analysts.

Rapid7 saw product subscription revenue of $205.59 million in the quarter, up 8% year-over-year and professional services revenue inched up 1% to $9.06 million. The company ended the quarter with 11,619 customers, up 2% year-over-year, with annualized recurring revenue growing 6%, to $823.1 million. The average annual recurring revenue per customer grew 4%, to $70,800.

Recent business highlights include Rapid7’s September launch of enhanced third-party detections within Managed Threat Complete, part of its Managed Detection and Response solution. The upgrade extended Rapid7’s global coverage to include integrations with CrowdStrike Falcon, SentinelOne Singularity Endpoint and Microsoft Defender for Endpoint, enhancing defense-in-depth capabilities.

Additionally, Rapid7 introduced Vector Command, a fully managed offensive security service combining the external attack surface assessment from the new Command Platform with continuous Red Teaming by Rapid7’s experts. The service provides customers with an attacker’s perspective, enabling them to identify and address potential weaknesses in their information technology security posture.

In July, Rapid7 also announced that it had acquired Noetic Cyber Inc., a startup with a platform for detecting vulnerabilities in enterprise networks.

More recently, reports have suggested that Rapid7 is exploring options with investment bankers after attracting acquisition interest from buyout firms. Reuters, referencing unnamed sources, reported on Oct. 28 that Rapid7 is in early-stage talks with private equity firms, including Advent International Corp., Bain Capital LP and EQT AB, and is exploring a potential sale.

“Rapid7 continued to see positive momentum across key areas of our business in the third quarter, highlighted by growth in our threat detection and response business, and strong demand for our consolidated offerings, which resulted in revenue and operating income exceeding guided ranges,” Chief Executive Corey Thomas said in the company’s earnings release. “There are also a number of promising indicators on the horizon, including a stronger sales pipeline and early positive traction from our newly launched Command platform.”

For its fiscal 2024 fourth quarter, Rapid7 expects adjusted earnings per share of 48 to 51 cents on revenue of $211 million to $213 million. For the full year, the company expects adjusted earnings per share of $2.28 to $2.31 on revenue of $839 million to $841 million.

Photo: Rapid7