Smartsheet (SMAR) 5 Sep 24 2025 Q2 Earnings call transcript

Smartsheet Inc. recently held its Fiscal 2025 Q2 earnings call, revealing a strong quarter for the company. The call was led by Aaron Turner, Head of Investor Relations, with CEO Mark Mader and CFO Pete Godbole also present. The call highlighted several key themes, including growth, enterprise adoption, and strategic investments in the company's offerings.

Growth and Enterprise Adoption

The call emphasized the company's growth, with Q2 revenue coming in at $276.4 million, up 17% year-over-year. This growth was driven by the expansion of customers, including Intuit, SKECHERS, City National Bank, and a large global system integrator. The company also launched a new pricing and packaging model in June, which has seen thousands of new customers transacting on the model. This new model is expected to lead to high engagement and the addition of many provisional members across these plans.

Moreover, Smartsheet has seen significant growth in its enterprise segment, with 77 customers now having ARR over $1 million, up 50% from Q2 last year. This growth is a testament to the company's ability to cater to the needs of large enterprises, offering them a robust and scalable solution for work management.

Strategic Investments and Innovations

The call also highlighted Smartsheet's strategic investments and innovations. The company is investing in the comprehensive modernization of its platform, which is expected to be showcased at its annual customer conference, ENGAGE Seattle. The new Smartsheet experience, which is more beautiful, powerful, and integrated than ever before, is set to empower customers to manage their projects, programs, and processes at even larger scales and sophistications.

The company is also focusing on AI-powered tools, which have shown significant adoption and benefits for users. In Q2, there was nearly 50% sequential growth in the number of users utilizing AI tools, with approximately 47,000 users having already saved an estimated 1 million hours from AI automations and performance improvements. The use of AI is expected to continue to grow, with plans to expand its capabilities to support cross-sheet formulas, provide portfolio insights, and co-build solutions with users.

Financial Performance and Outlook

Financially, Smartsheet reported a strong quarter, with ARR growing 17% year-over-year to $1.093 billion. The company also launched a share buyback program, repurchasing 918,000 shares for a total of $40 million in the quarter. Looking ahead, Smartsheet expects revenue to be in the range of $282 million to $285 million for Q3, with non-GAAP operating income in the range of $42 million to $44 million. For the full fiscal year '25, the company expects revenue to be $1.116 billion to $1.121 billion, representing growth of 16% to 17%.

Conclusion

In conclusion, Smartsheet Inc.'s Fiscal 2025 Q2 earnings call highlighted a strong quarter for the company, with growth, enterprise adoption, and strategic investments driving its performance. The company's focus on AI-powered tools and platform modernization positions it well for future growth, while its financial performance and outlook are encouraging. With the ENGAGE Seattle conference on the horizon, Smartsheet is poised to showcase its latest innovations and continue its momentum into the second half of FY '25.