Tenable Holdings, Inc. (TENB) Earnings & Analysis

Latest quarter

Tenable reported Q3 FY2026 revenue of $276.4 million, up from $252.4 million a year earlier and above the $271.6 million consensus. Adjusted earnings per share of $0.63 also exceeded the $0.51 consensus. Revenue finished above Tenable’s own Q3 guidance.

The company’s filing attributed the revenue increase to a $25.6 million rise from existing customers, partly offset by a $1.7 million decline from new customers. It reported increases in both U.S. and international revenue. Tenable One accounted for 59.0% of new business in the quarter.

Tenable reported diluted earnings per share of $0.10, compared with $0.02 a year earlier. Gross margin was 77.8%, versus 77.5%, while operating margin was 6.05%, compared with 2.83%. Free cash flow rose to $64.2 million from $51.6 million.

The company repurchased 6.8 million shares for $223.8 million during Q3, including 5.3 million shares for $170.5 million in connection with its convertible senior notes issuance.

Adjusted EPS is the figure the consensus estimates, not the GAAP EPS above.

What management said on the call

On Tenable’s Q2 earnings call, the latest call represented here, Co-CEO Mark Thurmond said customers were investing in broader exposure management programs. He attributed Tenable One adoption partly to pricing and packaging changes that made the path to the platform easier, as well as demand associated with AI-driven threats.

CFO Matthew Brown said Tenable One accounted for 50% of Q2 new business. He said existing-account expansion and renewals drove revenue growth, and that professional services contributed more than expected. Brown also reported that the net dollar expansion rate rose to 106% from 105% in the prior quarter.

In response to a question about the expansion rate, Brown said the company expected it to hold at 106% for the rest of the year. Discussing pricing, he said more customers had chosen Tenable One Advanced, which carries a higher selling price than standalone vulnerability management. He attributed customer gains partly to migration from standalone products and expansion by existing platform customers.

Thurmond said customers were consolidating tools and that Tenable had displaced providers as customers moved toward exposure management. He said Advanced attracted customers seeking additional cloud security, attack-path analysis and Hexa tokens. On Hexa, Thurmond said customers were using prompts to manage scanning workflows and automate parts of remediation; Tenable had created a product for customers to purchase incremental tokens when they exceeded their allocations.

On margins and investment, Brown reported Q2 non-GAAP gross margin of 81.4%, compared with 82.0% a year earlier. He said Tenable was shifting spending toward product development and sales capacity and expected to continue investing in the second half while meeting its profitability targets. Looking ahead on that call, Brown expected Q3 revenue of $270 million to $273 million.

Guidance

Tenable now expects FY2026 revenue of $1.084 billion to $1.087 billion, compared with its previous $1.075 billion to $1.081 billion range. It expects non-GAAP operating income of $270.0 million to $273.0 million, up from its prior $258.0 million to $264.0 million range.

The company forecasts non-GAAP net income of $250.0 million to $253.0 million, versus its previous $228.0 million to $234.0 million guide. It expects non-GAAP diluted earnings per share of $2.16 to $2.19, compared with $1.95 to $2.00 previously.