0001628280-25-050149
SEC filingRevenue grew 15% YoY, operating losses narrowed, and non-GAAP operating margin improved to 17% in Q3 2025, driven by GTM evolution.
In Q3 2025, Procore delivered revenue of $338.9 million, a 15% increase year-over-year, driven primarily by existing customer expansion (77% of growth) and new customer acquisitions (23%). Gross profit rose 12% to $270.1 million, but gross margin contracted 100 bps to 80% due to higher cost of revenue, which increased 25% from investments in customer support headcount (+24%), cloud hosting, and amortization of capitalized software. Operating expenses grew at a slower pace (sales & marketing +2%, R&D +9%), while G&A declined 4% as the company focused on efficiency. Consequently, GAAP operating loss narrowed from $36.5 million to $15.0 million. Net loss improved to $9.1 million from $26.4 million, aided by lower interest income and accretion income. On a non-GAAP basis, operating income surged to $58.6 million (17% margin) from $26.3 million (9% margin), underscoring improved operating leverage.
While Procore does not report formal segments, customer metrics reveal strong underlying momentum. Customers with over $100,000 in annual recurring revenue (ARR) grew 15% year-over-year to 2,602, while total customer count increased 4% to 17,623. Gross retention rate (GRR) improved to 95% from 94%, indicating high customer satisfaction and low churn. Current remaining performance obligations (cRPO) rose 23% to $911.2 million, with 45% of the increase from existing customers and 55% from new. Revenue mix tilted toward existing customers, reflecting successful upsell and cross-sell of products like Procore Pay and the Novorender 3D platform. International revenue remained steady at 15% of total revenue, with continued investment in overseas markets.
Management’s outlook emphasizes the ongoing evolution of the go-to-market (GTM) operating model, which involves deploying regional general managers and product specialists. While near-term disruptions and investments are expected, the company believes this will enhance customer relationships and operational efficiency over the long term. Procore plans to sustain investment in R&D (headcount up 27% since September 2024) and international expansion (offices in Sydney, Toronto, London, Dublin, and Dubai). No explicit numeric guidance was provided, but the company highlighted macroeconomic uncertainties (tariffs, interest rates) that could temper customer spending. Capital allocation priorities include organic growth, accretive M&A (e.g., Novorender, Intelliwave), and returning capital via stock repurchases—a new $300 million buyback program was authorized in November 2025. Procore’s strong liquidity ($727.9 million in cash and marketable securities) supports these initiatives, though the company cautions it may not achieve profitability in the near term.
As of September 30, 2025, Procore held $350.5 million in cash and cash equivalents and $377.4 million in marketable securities (current and non-current), for a total liquidity position of $727.9 million. The company has no outstanding debt. Total assets were $2.06 billion, with stockholders' equity of $1.22 billion. The current ratio (current assets / current liabilities) stands at 1.33x. Deferred revenue, a key indicator of future revenue, totaled $577.6 million ($572.1 million current, $5.5 million non-current).
Procore disclosed $1.4 billion in remaining performance obligations (RPO) as of September 30, 2025, of which $911.2 million (65%) is expected to be recognized as revenue in the next 12 months, with substantially all of the remaining $498.3 million recognized between 12 and 36 months. The company also has a $94.0 million non-cancelable hosting services commitment running from March 2025 through February 2028. Additionally, Procore has a contractual obligation to provide up to $7.1 million in additional investment funding to limited partnerships at the option of the investees.
Procore does not pay dividends. During the nine months ended September 30, 2025, the company repurchased and retired 1,903,527 shares of common stock at a weighted average price of $67.67 per share for an aggregate of $128.8 million under the prior $300 million authorization (which expired on October 29, 2025). On November 3, 2025, the Board authorized a new $300 million stock repurchase program expiring November 3, 2026. Capital expenditures (property and equipment) were $12.4 million for the nine-month period, representing 1.3% of revenue. The company also capitalized $47.9 million in software development costs.
Procore operates as a single operating segment. The CODM (CEO) evaluates financial performance on a consolidated basis. Geographic revenue breakdown shows 85% from the U.S. and 15% from the rest of the world for both the three and nine months ended September 30, 2025 and 2024. No further segment-level operating income or margin is disclosed.
For the nine months ended September 30, 2025, Procore generated $185.3M in operating cash flow, up from $167.1M in the prior year, a 10.9% increase. Net loss widened to $63.2M from $43.7M, but non-cash charges (stock-based compensation of $160.0M, depreciation and amortization of $83.3M) more than offset the loss. Working capital changes were mixed: accounts receivable provided $42.6M, while deferred contract cost assets consumed $31.8M and deferred revenue declined $15.3M.
Capital expenditures (capex) totaled $60.3M, comprising $12.4M in property and equipment and $47.9M in capitalized software development costs, up from $40.0M in the prior period. Free cash flow (not explicitly stated) would be approximately $125.0M, providing ample coverage for share repurchases of $128.8M.
Investing activities also included $41.5M for business combinations and $277.8M in marketable securities purchases (partially offset by maturities and sales). Financing activities were dominated by share repurchases ($128.8M) and tax withholding for net share settlement ($71.2M), resulting in a net financing cash outflow of $171.8M. No dividends were paid. Overall, cash and equivalents declined $81.5M to $357.4M.