Description
HubSpot’s Upmarket Momentum — Large Deals Above $120,000 ARR Grew 38%!
HubSpot Inc. reported its second quarter of fiscal 2026 results with revenue growth of 17.5% year-over-year in constant currency, reaching a total customer base exceeding 306,000, although net additions of 7,000 were below expectations due to cautious buying behavior. Subscription revenue increased 20% year-over-year, with international markets growing notably faster than domestic. Operating margins improved significantly, with non-GAAP operating margin expanding by 3 percentage points to 20.3%, driven by disciplined spending partly offset by increased AI investment costs. Non-GAAP net income and earnings per share rose 40% and 49% respectively, while free cash flow represented 18% of revenue. The company faced two main headwinds during the quarter. First, deliberate strategic changes in product offerings and pricing, including the introduction of trials to allow customers to test HubSpot’s AI agents within their own environments before purchase, and the implementation of outcome-based pricing aimed at providing predictable AI costs.
