How did RPD's Q4 earnings surprise impact its annual performance?

Rapid7's (RPD) Q4 earnings surprise had a notable impact on its annual performance, highlighting the company's strong growth trajectory despite some challenges: 1. **Annual Recurring Revenue (ARR) Growth**: RPD's ARR increased by 6% year-over-year to $823 million, reflecting steady growth in its Threat Detection Response business. This growth is a positive indicator of the company's ability to expand its customer base and increase revenue from existing customers. 2. **Revenue and Operating Income**: Q4 revenue reached $215 million, an 8% increase over the prior year. Operating income for the quarter was $44 million, representing a 21% operating margin. These figures suggest that RPD is not only growing its top line but also improving its profitability. 3. **International Revenue Growth**: International revenue grew by 17% year-over-year, now nearly a quarter of total revenue. This diversification into international markets is a strategic move that is paying off, indicating a growing global presence for the company. 4. **Product Gross Margin**: With a product gross margin of 76% for the quarter, RPD demonstrates strong efficiency in its core product offerings. This is a positive signal for the company's ability to generate profits from its products. 5. **Net Income and EPS**: RPD reported a net income of $25.53 million, representing a significant year-over-year growth of 116.7%. The net income per diluted share was $0.66, which, when compared to the previous year, shows a substantial increase. 6. **Free Cash Flow**: The company maintained a healthy free cash flow of $39 million for the quarter, which is crucial for investing in growth opportunities and returning capital to shareholders. 7. **Future Outlook**: RPD anticipates a full-year ARR outlook of $835 million to $845 million, growth of 4% to 5% over the prior year. Full-year revenue is expected to reach $839 million to $841 million, representing an 8% growth. These projections suggest confidence in continued growth and expansion into the market. In conclusion, RPD's Q4 earnings surprise has had a positive ripple effect on its annual performance, underscored by strong growth in revenue, ARR, and net income. The company's strategic initiatives, such as the launch of the Command Platform and a focus on international markets, are contributing to its robust financial performance.