Cellebrite DI Ltd. (CLBT) Q3 2025 Earnings Call Transcript
Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
Overview
The earnings call summary shows strong financial performance with optimistic guidance, particularly in ARR and revenue growth. The Corellium acquisition and FedRAMP authorization are strategic positives. The Q&A reveals confidence in resolving CFIUS issues and strong demand in defense and intelligence sectors. Despite some management vagueness, the overall sentiment is positive, supported by strategic initiatives and growth prospects.
Key Financial Performance
ARR (Annual Recurring Revenue) ARR grew 19% year-over-year to $440 million. Sequentially, ARR increased 5%, reflecting increased spending by existing customers.
Subscription Revenue Subscription revenue grew 21% year-over-year, driven by strong performance in the U.S. state and local segment and the Latin America region.
Adjusted EBITDA Adjusted EBITDA grew 20% year-over-year to $37.7 million, with a margin expansion of 60 basis points to 29.9%. This reflects thoughtful capital allocation and disciplined hiring.
Revenue Revenue increased 18% year-over-year to $126 million, primarily due to subscription revenue growth.
Gross Profit Gross profit increased to $106.5 million, representing a gross margin of 84.5%. This reflects ongoing investment in cloud infrastructure and federal ATO processes.
Net Income Net income was $36.9 million, or $0.14 per diluted share, reflecting a slight increase in weighted average diluted shares outstanding.
Free Cash Flow Free cash flow for the third quarter was $30 million, and for the trailing 12 months, it was $140 million, representing a 31% margin compared to 27% in the prior 12-month period.
SaaS and Cloud-Based Solutions ARR ARR for SaaS and cloud-based solutions grew three times faster than total ARR, with Guardian ARR growing over 100% year-over-year for the fifth consecutive quarter.
You have reached the limit. Sign up to access full content
Get started
Operating Highlights
Inseyets Offering Conversion: 47% of the installed digital forensics license base converted to Inseyets, with a target of 50% by year-end 2025.
Guardian Investigate Launch: New AI-powered SaaS solution to launch in early 2026, aimed at transforming investigation workflows.
Corellium Acquisition: Pending acquisition of Corellium to expand TAM and value proposition, particularly in defense and intelligence sectors.
U.S. Federal Segment Growth: Year-over-year growth achieved in Q3, with expectations for a resurgence in 2026.
D&I Sector Expansion: Growth in global defense and intelligence sectors, particularly in Europe, supporting use cases like antiterrorism and border control.
ARR Growth: Annual Recurring Revenue grew 19% year-over-year to $440 million.
SaaS and Cloud ARR Growth: ARR for SaaS and cloud-based solutions grew three times faster than total ARR.
Adjusted EBITDA: Increased 20% year-over-year with margin expansion to 29.9%.
AI and Digital Investigations: Focus on AI-driven solutions like Guardian Investigate to enhance investigation capabilities.
Unlock and Access Solutions: Leadership in Android and iOS unlock solutions, with 45% of Inseyets and legacy forensics base attached to unlock offerings.
You have reached the limit. Sign up to access full content
Get started
Risk or Challenges
U.S. Federal Segment Growth: The company does not expect a full return to normalized growth in the U.S. Federal segment until calendar 2026. Spending headwinds, leadership changes, and government seasonality, combined with a recent shutdown, are cited as challenges. These factors are considered transitory but could impact near-term performance.
Corellium Acquisition: The acquisition of Corellium is pending and subject to CFIUS requirements. Delays or complications in closing this acquisition could impact the company's ability to expand its TAM and value proposition, particularly in defense and intelligence sectors.
Macroeconomic and Geopolitical Risks: Crime and geopolitical risks are increasing, which could drive demand for Cellebrite's solutions. However, constrained budgets for public safety labor could limit customer spending, impacting revenue growth.
U.S. Federal Sector Spending: The timing and magnitude of spending in the U.S. Federal customer segment remain uncertain. This has been a challenge in 2025 and could continue to impact financial performance.
Cloud Infrastructure Investment: Ongoing investments in cloud infrastructure, including the federal ATO process, are increasing costs. While these are strategic, they could pressure margins in the short term.
AI and Digital Investigations: The company is investing heavily in AI-powered solutions like Guardian Investigate. While these innovations are promising, they require significant upfront investment and carry execution risks.
Sun Corporation Shareholder Overhang: Sun Corporation owns 40% of Cellebrite's shares. This concentrated ownership could create an overhang, potentially impacting shareholder value and limiting strategic flexibility.
You have reached the limit. Sign up to access full content
Get started
Guidance & Outlook
ARR Growth: ARR grew 19% year-over-year to $440 million in Q3 2025. Sequential ARR growth is expected to continue in the mid-single digits for Q4 2025. ARR for SaaS and cloud-based solutions grew three times faster than total ARR.
Revenue Projections: Full-year 2025 revenue is projected to be in the range of $470 million to $475 million, representing 17% to 18% growth. Q4 2025 revenue is expected to be between $123 million and $128 million.
Adjusted EBITDA: Full-year 2025 adjusted EBITDA is projected to be in the range of $124 million to $127 million, with a margin of approximately 26% to 27%. Q4 2025 adjusted EBITDA is expected to range from $35 million to $38 million, with a margin of 28% to 30%.
Free Cash Flow: The company expects a free cash flow margin of approximately 30% for 2025, with a trailing 12-month free cash flow of $140 million.
U.S. Federal Sector Growth: Growth in the U.S. federal sector is expected to resume in 2026, driven by targeted funding, pent-up demand, and FedRAMP authorization to operate with DOJ sponsorship in early 2026.
Guardian Investigate Launch: The AI-powered Guardian Investigate solution is set to launch in early 2026, aimed at transforming the investigation lifecycle and driving AI-enabled insights.
Corellium Acquisition: The acquisition of Corellium is expected to close by the end of 2025, expanding TAM and value proposition, particularly in defense, intelligence, and private sectors. Initial ARR contribution from Corellium is anticipated in 2026.
2026 ARR Growth Drivers: ARR growth in 2026 is expected to be driven by new customer acquisitions, price increases, broader adoption of Inseyets, and expansion of Guardian and Pathfinder solutions. Corellium solutions are expected to contribute incremental ARR growth.
Profitability and Margins: The company plans to maintain a free cash flow margin of 30% or greater in 2026, with incremental improvement in adjusted EBITDA margin driven by operating leverage and AI investments.
You have reached the limit. Sign up to access full content
Get started
Shareholder Return Plan
The selected topic was not discussed during the call.
You have reached the limit. Sign up to access full content
Get started
Key Q&A
Q:What are the internal goals or thoughts on the percentage of ARR transitioning to the cloud over the next 2-3 years?
A:David Barter stated that the company is proactively working with customers transitioning to the cloud. Many products are already in the cloud, and all new developments are cloud-based. However, no specific percentage goals were provided.
Q:What is the progress and pipeline for Corellium as a key growth driver?
A:Marcus Jewell mentioned an 8-figure pipeline spread across defense, intelligence, and Global 2000 sectors. Two orders have been processed, with more expected in Q4. Thomas Hogan added that Corellium's core business was $15 million ARR, and the pipeline is already in double-digit millions, showing strong potential.
Q:What are the growth prospects for 2026 and insights into the 20%-ish ARR growth range?
A:Thomas Hogan expressed confidence in accelerating growth in 2026 but refrained from providing specific numbers until February. He emphasized growth against a larger baseline and highlighted confidence in the company's trajectory.
Q:What is the status of addressing CFIUS issues with Corellium, and are there contingency plans?
A:Thomas Hogan stated a 98% confidence in resolving CFIUS issues within the quarter. He acknowledged more inspection than anticipated but emphasized the importance of the technology to agencies. Contingency plans were not detailed.
Q:What was the contribution of Cellebrite Federal in the quarter, and how is it positioned for fiscal 2026?
A:Thomas Hogan noted a return to growth in Q3 with strategic client wins. Marcus Jewell highlighted significant deals, including an $11 million order and a 30%-35% expansion with another agency. Federal customers are increasingly adopting cloud solutions, and a major renewal is expected in the first half of 2026.
Q:How does the company differentiate Federal growth from budget flush versus secular recovery?
A:Marcus Jewell clarified that growth was driven by solid execution and product-market fit rather than budget flush. The company focuses on mission-critical, program-driven products.
Q:What is the status of discussions with Sun Corporation regarding their ownership stake?
A:David Barter described Sun Corporation as measured and rational, gradually reducing their stake over time. Thomas Hogan speculated that further sell-downs are likely in the near future.
Q:How does Guardian Investigate compare to Pathfinder, and is there a SaaS version of Pathfinder?
A:Thomas Hogan explained that Pathfinder is optimized for on-prem or VPC-based analytics, while Guardian Investigate focuses on multi-data source case management and cloud-based AI analytics. Marcus Jewell added that both products are complementary, with distinct use cases.
Q:What is the pipeline and go-to-market strategy for the defense and intelligence vertical?
A:Marcus Jewell highlighted strong demand driven by global threats and NATO spending. The company is appointing a single leader for the vertical and leveraging accreditations like FedRAMP High to strengthen its position.
Q:What are the competitive dynamics in the market, and are there new entrants?
A:Thomas Hogan and Marcus Jewell stated that there are no significant new entrants due to high barriers to entry. They emphasized Cellebrite's strong competitive position, brand trust, and proven capabilities.
Q:What is the use of cash post-Corellium acquisition?
A:David Barter mentioned maintaining flexibility for investments in scaling companies like Corellium and exploring adjacencies. Thomas Hogan added that the company is focused on growth opportunities.
Q:What does the ahead-of-schedule Inseyets conversion mean for ARR and upsell opportunities?
A:Marcus Jewell noted expanded cross-sell opportunities and potential TAM expansion into defense and intelligence. Thomas Hogan highlighted unit growth, pricing power, and cloud storage economics as additional drivers.
Q:What drove growth in U.S. state and local government (SLG) and Latin America?
A:Marcus Jewell attributed SLG growth to crime-driven demand and grant budgets. Latin America's growth was driven by high crime rates, strong political connections, and end-to-end solutions.
Q:What are the priorities for cash usage after the Corellium acquisition?
A:David Barter and Thomas Hogan emphasized maintaining flexibility for investments in scaling companies, exploring adjacencies, and supporting growth initiatives.
Q:Review of Unclear Management Responses
A:Management avoided providing specific numbers or detailed insights on the percentage of ARR transitioning to the cloud, the exact growth rate for 2026, and contingency plans for CFIUS issues with Corellium. Additionally, they did not elaborate on the urgency or timeline of Sun Corporation's sell-down of its ownership stake.
You have reached the limit. Sign up to access full content
Get started
Earnings Word Cloud
The most frequently occurring keywords in this quarter's earning call
AI acquisition
AI insight
AI investigation
ARR SaaS
America region
Android phone
Android universe
Arm virtualization
CFO CRO
CRO replay
Cellebrite forensics
Cellebrite path
Chairman conviction
Corellium Arm
Corellium TAM
Corellium end
Corellium reminder
Crime risk
DI agency
DI expansion
DI sector
DOJ sponsorship
Europe quarter
Federal milestone
Guardian Investigate
Guardian focus
Guardian industry
Inseyets
TAM value
calendar
defense intelligence
industry capability
intelligence agency
power
slide
source
unlock
use case
vector
CLBT Transcript
Cellebrite DI Ltd. (CLBT) Presents at J.P. Morgan 54th Annual Global Technology, Media and Communications Conference Transcript
Neutral5-18
Cellebrite DI Ltd. (CLBT) Q1 2026 Earnings Call Transcript
Positive5-14
Cellebrite's earnings call shows strong financial performance with a 21% ARR growth and a 29% increase in adjusted EBITDA. The company has a solid cash position and geographic ARR growth. Despite some uncertainties in AI adoption and flat net new ARR, management remains optimistic about future growth and product adoption. The Q&A session reveals confidence in overcoming competitive threats and leveraging new products, contributing to a positive outlook. With a market cap of $2.43 billion, the stock is likely to experience a positive movement (2% to 8%) in the next two weeks.
Avante Corp. (XX:CA) Q3 2026 Earnings Call Transcript
Positive3-3
Financial performance shows solid growth in revenue, RMR, and net income, with improved margins. Analysts' Q&A responses indicate confidence in maintaining growth without additional expenses and optimism about demand stability. The company's focus on M&A and innovation, along with positive guidance, supports a positive outlook. Given the market cap of $2.4 billion, the stock price is likely to react positively, but not dramatically.
Cellebrite DI Ltd. (CLBT) Presents at Morgan Stanley Technology, Media & Telecom Conference 2026 Transcript
Neutral3-3
CLBT Report
Frequently Asked Questions
Where does this earnings call transcript come from?
All transcripts are sourced directly from the official live webcast or the company’s official investor relations website. We use the exact words spoken during the call with no paraphrasing of the core discussion.
How soon is the transcript available after the earnings call ends?
Full verbatim transcripts are typically published within 4–12 hours after the call ends. Same-day availability is guaranteed for all S&P 500 and most mid-cap companies.
Is the transcript edited or altered in any way?
No material content is ever changed or summarized in the “Full Transcript” section. We only correct obvious spoken typos (e.g., “um”, “ah”, repeated 10 times”, or clear misspoken ticker symbols) and add speaker names/titles for readability. Every substantive sentence remains 100% as spoken.
Why do some answers appear as “Unclear” or “Inaudible”?
When audio quality is poor or multiple speakers talk over each other, we mark the section instead of guessing. This ensures complete accuracy rather than introducing potential errors.
Who creates the AI Summary and Key Q&A highlights shown above the transcript?
They are generated by a specialized financial-language model trained exclusively on 15+ years of earnings transcripts. The model extracts financial figures, guidance, and tone with 97%+ accuracy and is regularly validated against human analysts. The full raw transcript always remains available for verification.
