HubSpot Q2 Earnings Call Highlights

Q2 revenue grew 20% year over year to $_____ on a reported basis, but customer additions fell short of expectations as buyers faced tighter technology budgets, longer approval cycles and heightened scrutiny over AI investments. Net revenue retention declined to 102%. HubSpot reported strong AI product adoption, with more than 55% of Professional and Enterprise customers using its agents or Breeze Assistant. The company is expanding its AI platform with trials, outcome-based pricing, Agent Builder and Agent Hub to move customers from experimentation toward broader deployment. Profitability and cash flow improved, with a 20% non-GAAP operating margin, $168 million in free cash flow and more than $500 million in quarterly stock repurchases. Management maintained its full-year outlook but expects customer additions to slow to roughly 5,000–6,000 per quarter and budget-related headwinds to persist.

HubSpot reported second-quarter 2026 revenue growth of 20% year over year on a reported basis, or 17% in constant currency, as the company navigated slower customer acquisition and greater budget scrutiny tied to the transition toward artificial intelligence products. Chief Executive Officer Yamini Rangan said April began slowly and that the quarter did not develop as the company had expected. She attributed the performance to deliberate changes in product, pricing and go-to-market strategy, as well as a demand environment in which customers showed increased caution around technology budgets.

“Customers adopting AI want proof of value before they commit and predictability in what it costs,” Rangan said. HubSpot introduced trials that allow customers to test agents and its AEO offering in their own environments, while also lowering certain entry prices, adding outcome-based pricing for several agents and providing spending controls. Rangan said the moves were expected to extend buying cycles in the near term but were intended to lower adoption barriers and support longer-term AI usage. She added that the trial approach has been most effective with larger customers that can receive additional support from HubSpot teams and partners.

HubSpot added 7,000 net new customers during the quarter, ending the period with more than 306,000 customers globally. The customer total grew 14% from a year earlier, but Chief Financial Officer Kate Bueker said the quarterly additions were below the company’s expectation of 9,000 to 10,000 net adds, primarily because of weaker conversion rates and increased buyer hesitation. Domestic revenue increased 17% year over year. International revenue rose 23% on a reported basis and 18% in constant currency, accounting for 49% of total revenue. Subscription revenue grew 20%, while services and other revenue increased 8%. Average subscription revenue per customer was $11,800, up 4% on a reported basis and 2% in constant currency. Customer dollar retention remained in the high 80% range, while net revenue retention was 102%, down one percentage point year over year. Bueker said expansion in seats and credits was offset by pressure from other upgrade motions as customers optimized budgets. Management said prospects are involving larger buying committees, with more transactions requiring approval from chief executives, boards or private-equity firms. Rangan said larger opportunities are still closing and up-market win rates remain solid, but approvals are taking longer. Deals worth more than $120,000 in annu.