N-able — Third Quarter 2026 Earnings Summary

Financial Performance:

• Total revenue for the quarter was $137.5 million, representing 4.9% year-over-year growth (4.6% on a constant currency basis).
• Subscription revenue was $136.3 million, up 5.0% year-over-year (4.7% on a constant currency basis).
• Total Annual Recurring Revenue (ARR) reached $553.1 million, reflecting 4.7% year-over-year growth (4.7% on a constant currency basis).
• GAAP gross margin was 74.9% and non-GAAP gross margin was 78.4%.
• GAAP net loss was $4.4 million ($0.02 per diluted share), while non-GAAP net income was $22.9 million ($0.12 per diluted share).
• Adjusted EBITDA was $43.6 million, representing a 31.7% margin.
• Cash and cash equivalents were $92.5 million as of September 30, 2026.
• Total debt, net of unamortized discount and debt issuance costs, was $392.7 million.
• Deferred revenue included $20.468 million in current portion and $443,000 in non-current portion.

Guidance and Future Outlook:

• Full-year 2026 ARR outlook updated to $558 million–$560 million, representing approximately 3% to 4% year-over-year growth on a reported basis and 5% on a constant currency basis.
• Full-year 2026 total revenue guidance is $541 million–$542 million, representing approximately 6% to 7% year-over-year growth on a reported basis and 5% on a constant currency basis.
• Full-year 2026 Adjusted EBITDA guidance is $158.5 million–$159.5 million, representing approximately 29% of total revenue.
• Fourth quarter 2026 total revenue is expected to be $133 million–$134 million, representing approximately 3% to 4% year-over-year growth on a reported basis and 4% to 5% on a constant currency basis.
• Fourth quarter 2026 Adjusted EBITDA is expected to be $39.6 million–$40.6 million, representing approximately 30% of total revenue.

Business Segments and Product Lines:

• N-able Cove Data Protection was ranked number one overall in Infotech's Enterprise Backup Data Quadrant, protecting over 4 million Microsoft 365 mailboxes and over 200,000 businesses.
• N-able and SentinelOne expanded their strategic partnership to cover AI, cloud, identity, and managed response, enabling delivery of SentinelOne FedRAMP solutions.
• N-able launched AI-accelerated Vulnerability and Patch Management in its Unified Endpoint Management platform, designed to reduce patching windows from days to minutes.
• N-able announced a distribution partnership with Leader in Australia to provide nationwide access to its security portfolio for MSPs, resellers, and systems integrators.
• The company's AI-powered platform now protects over 500,000 businesses worldwide.

Market and Competitive Landscape:

• Management describes the cybersecurity backdrop as positive with escalating cyberthreats.
• The "AI Fog Report" highlighted market needs for intelligent automation to reduce alert noise and increase trust in AI security tools.
• The company focuses on delivering enterprise-grade protection to businesses of all sizes.

Risks and Challenges:

• Forward-looking statements note risks including adverse economic conditions, inflation, rising interest rates, and geopolitical events (e.g., conflicts in Russia/Ukraine and the Middle East) that could reduce IT spending.
• Risks include the ability to sell subscriptions, maintain customer loyalty, and successfully incorporate AI-powered features.
• Potential risks involve foreign exchange fluctuations, trade policy changes, and the inability to generate high-quality sales leads.
• The company cites risks related to cyberattacks, data breaches, and the potential for material weaknesses in financial reporting.
• Indebtedness and rising borrowing costs are identified as potential risks.

Management Commentary and Tone:

• CEO John Pagliuca stated that the conviction that every business deserves enterprise-grade protection is translating into real-world impact, with priorities focused on innovation, go-to-market execution, and business resilience.
• CFO Tim O'Brien noted the company continues to operate with discipline and highlighted the repurchase of approximately 5% of outstanding shares as a reflection of confidence in the approach and long-term value.
• Management expressed confidence in the positive backdrop for cybersecurity.

Other Key Points:

• N-able repurchased approximately 10.2 million shares for approximately $38.7 million in the third quarter, representing about 5% of shares outstanding.
• The Board previously approved a $50 million increase to the share repurchase program in August 2026, bringing total authorization to $125 million; approximately $56 million remained available as of the end of the quarter.
• Subsequent to the quarter end, N-able borrowed the full $75 million available under its delayed draw term loan facility.
• The company published "The AI Fog Report," a survey of 595 cybersecurity decision-makers in the U.S. and U.K.
• Financial results are preliminary and pending final review by the company and external auditors.