TTAN
Servicetitan, INC
NASDAQ
8-K: ServiceTitan Announces Strong Q4 and Full Year Fiscal 2025 Financial Results, Exceeding Expectations
Sentiment:
Earnings Release
13 March 2025 4:06 PM
ServiceTitan reports a 29% increase in Q4 revenue and a 26% increase in full-year revenue, signaling a strong start to its public market era.
Better than expected
The company's revenue growth exceeded expectations, with a 29% increase in Q4 and a 26% increase for the full year.
Non-GAAP profitability improved significantly, with a shift from a loss to income from operations for both Q4 and the full year.
Net dollar retention remained high, indicating strong customer satisfaction and upselling opportunities.
Summary
- ServiceTitan announced its Q4 and full-year fiscal 2025 financial results on March 13, 2025.
- Total revenue for Q4 increased by 29% year-over-year to $209.3 million.
- Platform revenue for Q4 increased by 30% year-over-year to $200.1 million.
- GAAP loss from operations for Q4 was ($99.9) million, compared to ($48.1) million in the same period last year.
- Non-GAAP income from operations for Q4 was $6.9 million, compared to $2.1 million in the same period last year.
- GAAP net loss for Q4 was ($100.9) million, compared to ($51.4) million in the same period last year.
- Non-GAAP net income for Q4 was $7.5 million, compared to a non-GAAP net loss of ($0.8) million in the same period last year.
- Total revenue for the full year increased by 26% year-over-year to $771.9 million.
- Platform revenue for the full year increased by 27% year-over-year to $739.5 million.
- GAAP loss from operations for the full year was ($230.0) million, compared to ($182.9) million last year.
- Non-GAAP income from operations for the full year was $25.2 million, compared to a non-GAAP loss of ($17.1) million last year.
- GAAP net loss for the full year was ($239.1) million, compared to ($195.1) million last year.
- Non-GAAP net income for the full year was $16.5 million, compared to a non-GAAP net loss of ($27.4) million last year.
- Cash and cash equivalents totaled $441.8 million as of January 31, 2025.
- Net cash generated by operating activities was $15.4 million for Q4 and $37.1 million for the full year.
- Non-GAAP free cash flow was $10.8 million for Q4 and $15.5 million for the full year.
- Net dollar retention was greater than 110% for Q4.
- Gross dollar retention was greater than 95% for the full year.
- Gross Transaction Volume was $17.0 billion for Q4 and $68.5 billion for the full year.
- Total active customers were approximately 9,500 as of January 31, 2025.
- The company expects Q1 2026 total revenue to be in the range of $207 million to $209 million and non-GAAP income from operations to be in the range of $12 million to $13 million.
- For the full year fiscal 2026, the company expects total revenue in the range of $895 million to $905 million and non-GAAP income from operations in the range of $48 million to $53 million.
Sentiment
Score: 8
Explanation: The document presents a positive outlook with strong revenue growth, improving profitability, and high customer retention. While GAAP losses persist, the focus on non-GAAP metrics and the forward-looking guidance suggest a confident management team and a promising future.
Positives
- Revenue growth is strong, with a 29% increase in Q4 and a 26% increase for the full year.
- Platform revenue is also growing rapidly, increasing by 30% in Q4 and 27% for the full year.
- Non-GAAP profitability is improving, with a shift from a loss to income from operations for both Q4 and the full year.
- Net dollar retention is high, indicating strong customer satisfaction and upselling opportunities.
- Gross Transaction Volume is increasing significantly, reflecting the growing volume of business conducted through the platform.
- The company has a healthy cash balance of $441.8 million.
- The outlook for fiscal year 2026 is positive, with expected revenue growth and continued non-GAAP profitability.
Negatives
- GAAP losses from operations and net losses remain significant, although they are being offset by non-GAAP profitability.
- GAAP loss from operations was ($99.9) million for the fourth quarter of fiscal 2025, compared to ($48.1) million in the fourth quarter of fiscal 2024.
- GAAP net loss was ($100.9) million for the fourth quarter of fiscal 2025, compared to ($51.4) million in the fourth quarter of fiscal 2024.
- GAAP loss from operations was ($230.0) million for fiscal 2025, compared to ($182.9) million for fiscal 2024.
- GAAP net loss was ($239.1) million for fiscal 2025, compared to ($195.1) million for fiscal 2024.
Risks
- The company's forward-looking statements are subject to risks and uncertainties that could cause actual results to differ materially.
- The company is not able to provide an outlook for GAAP income (loss) from operations or a reconciliation of expected non-GAAP income from operations to GAAP income (loss) due to the difficulty of estimating certain items.
Future Outlook
ServiceTitan expects total revenue in the range of $207 million to $209 million and non-GAAP income from operations in the range of $12 million to $13 million for the first quarter of fiscal 2026. For the full year fiscal 2026, the company expects total revenue in the range of $895 million to $905 million and non-GAAP income from operations in the range of $48 million to $53 million.
Management Comments
- Ara Mahdessian, co-founder and CEO, stated that the beginning of the new public market era for the trades, for their customers, and for ServiceTitan is off to a good start and he is proud of the way Titans executed this quarter.
- Vahe Kuzoyan, co-founder and President, stated that their goal and growth strategy is to become the operating system for the trades, and their core residential trades are performing well while their investments in roofing and commercial continue to deliver.
Industry Context
ServiceTitan's focus on providing a software platform for the trades industry positions it well to capitalize on the increasing adoption of technology in this historically underserved sector. The company's growth in revenue, customer base, and transaction volume indicates a strong demand for its services and a successful execution of its business strategy.
Comparison to Industry Standards
- Comparing ServiceTitan to similar SaaS companies serving specific industries is useful.
- For example, companies like Procore Technologies (construction management software) or Veeva Systems (pharmaceutical and life sciences software) often trade at high revenue multiples due to their specialized focus and strong market position.
- ServiceTitan's revenue growth rate of 26-29% is competitive with other high-growth SaaS companies.
- A net dollar retention rate above 110% is considered excellent, indicating strong customer loyalty and expansion within existing accounts.
- Gross margin is 65% which is lower than the 70-80% seen in other SaaS companies.
- The company's focus on non-GAAP profitability is common in the SaaS industry, as companies often prioritize growth and reinvestment over immediate GAAP profitability.
Stakeholder Impact
- Shareholders will likely react positively to the strong revenue growth and improving profitability.
- Employees may be encouraged by the company's positive performance and future outlook.
- Customers should benefit from the company's continued investment in its platform and services.
- Suppliers may see increased demand for their products and services as the company continues to grow.
- Creditors may view the company as a lower-risk borrower due to its improving financial performance.
Next Steps
- The company will hold a conference call to discuss the financial results on March 13, 2025.
- The company will file its Annual Report on Form 10-K for the fiscal year ended January 31, 2025.
Key Dates
- December 11, 2024: Date of the Prospectus filed with the SEC
- December 12, 2024: Date the Prospectus was filed with the SEC
- October 31, 2024: End of the fiscal third quarter
- January 31, 2025: End of fiscal year 2025 and Q4 2025
- March 13, 2025: Date of the press release and conference call
- April 30, 2025: End of the first quarter of fiscal year 2026
- January 31, 2026: End of fiscal year 2026
Keywords
TTAN
Servicetitan, INC
NASDAQ
Sector: TBD
Filings with Classifications
Worse than expected
1 July 2025 5:42 PM
Insider Trading Report
- A 10% owner and director, Bessemer Venture Partners, sold a substantial number of shares (225,277 shares) of ServiceTitan Class A Common Stock.
- Insider selling, especially by a significant holder, is generally perceived as a negative signal by the market, suggesting that the insider may believe the stock is fully valued or that better investment opportunities exist elsewhere.
Worse than expected
1 July 2025 5:36 PM
Insider Transaction Report
- Funds affiliated with a Director and 10% Owner, Byron B. Deeter, divested a substantial number of shares (225,277 shares) of ServiceTitan Class A Common Stock across two transactions. While the sales were by the funds and not directly by the individual, such significant sales by an affiliated entity of a major shareholder can be interpreted as a negative signal by the market.
Worse than expected
27 June 2025 7:08 PM
Insider Trading Report
- The document details significant insider selling by Bessemer Venture Partners, a 10% owner and director of ServiceTitan, Inc. Insider selling is generally perceived as a negative signal by the market, suggesting that a key stakeholder is reducing their exposure to the company's stock.
Worse than expected
27 June 2025 7:05 PM
Insider Transaction Report
- The sale of 137,543 shares by entities affiliated with a director and 10% owner is generally viewed as a negative signal by investors, suggesting a potential lack of confidence or a move to realize gains, which can put downward pressure on the stock price.
Worse than expected
12 June 2025 7:56 PM
Insider Transaction Report
- A significant sale of 500,000 shares by a 10% owner and director, Bessemer Venture Partners, could signal a lack of confidence or a strategic portfolio rebalancing, potentially leading to negative market perception.
Capital raise
12 June 2025 4:49 PM
Quarterly Report
- The company states, "We may be required to seek additional equity or debt financing."
- It notes that future capital requirements will depend on various factors, including business challenges, product enhancements, infrastructure improvements, and potential acquisitions.
- The company evaluates financing opportunities and acknowledges that obtaining additional financing on acceptable terms may not always be possible.
Better than expected
12 June 2025 4:49 PM
Quarterly Report
- Revenue growth of 27% significantly outpaced the prior year's comparable period.
- Net loss decreased by $9.7 million, indicating improved financial performance.
- Gross profit increased by 40%, and gross margins improved across the board, reflecting operational efficiencies.
- Net cash used in operating activities decreased, and non-GAAP free cash flow improved, showing better cash management.
- Gross Transaction Volume (GTV) increased by $3.2 billion, and the net dollar retention rate remained strong at over 110%, indicating robust customer adoption and expansion.
Better than expected
5 June 2025 4:07 PM
Quarterly Financial Results
- Total revenue grew 27% year-over-year to $215.7 million, exceeding the prior year's growth rate.
- Non-GAAP income from operations significantly increased to $16.2 million from $3.3 million in the prior year, indicating substantial improvement in core profitability.
- Non-GAAP operating margin improved to 7.5% from 1.9% year-over-year, reflecting enhanced operational efficiency.
- GAAP loss from operations decreased to $(49.5) million from $(53.4) million, showing a reduction in overall losses.
- Net cash used in operating activities improved to $(14.6) million from $(19.2) million, indicating a reduced cash burn.
Worse than expected
1 April 2025 9:28 PM
Annual Results
- The company's net loss increased from $195.1 million in fiscal year 2024 to $239.1 million in fiscal year 2025.
Better than expected
13 March 2025 4:06 PM
Earnings Release
- The company's revenue growth exceeded expectations, with a 29% increase in Q4 and a 26% increase for the full year.
- Non-GAAP profitability improved significantly, with a shift from a loss to income from operations for both Q4 and the full year.
- Net dollar retention remained high, indicating strong customer satisfaction and upselling opportunities.
Worse than expected
14 January 2025 5:10 PM
Quarterly Report
- The net loss increased from $39.7 million to $46.5 million year-over-year.
Better than expected
13 January 2025 4:05 PM
Earnings Release
- The company's non-GAAP income from operations turned positive, indicating improved profitability.
- Net cash generated from operating activities significantly increased, showcasing better cash management.
- Non-GAAP free cash flow improved, reflecting stronger financial health.
Worse than expected
10 December 2024 6:12 AM
S-1/A Filing
- The company's loss from operations increased by approximately 20% to 26% for the three months ended October 31, 2024 compared to the three months ended October 31, 2023.
Capital raise
10 December 2024 6:12 AM
S-1/A Filing
- ServiceTitan is conducting an initial public offering of its Class A common stock.
- The company intends to use approximately $310.6 million of the net proceeds from this offering to redeem all outstanding shares of its non-convertible preferred stock.
- The remaining net proceeds will be used for general corporate purposes, including working capital, operating expenses, and capital expenditures.
- The company may also use a portion of the net proceeds to acquire or invest in businesses, products, services, or technologies.
Worse than expected
3 December 2024 6:06 AM
S-1/A Filing
- The company has a history of losses and may not be able to achieve or sustain profitability in the future.
Capital raise
3 December 2024 6:06 AM
S-1/A Filing
- The company is conducting an initial public offering of shares of its Class A common stock.
- The company plans to use approximately $310.6 million of the net proceeds from this offering to redeem all outstanding shares of its non-convertible preferred stock.
- The remaining net proceeds will be used for general corporate purposes, including working capital, operating expenses and capital expenditures.
- The company may also use a portion of the net proceeds to acquire or invest in businesses, products, services or technologies.
Worse than expected
18 November 2024 11:01 AM
S-1 Filing
- The company experienced a net loss of $195.1 million for fiscal year 2024, which is worse than expected for a company of this size.
Capital raise
18 November 2024 11:01 AM
S-1 Filing
- ServiceTitan has filed an S-1 registration statement for its initial public offering.
- The company intends to use approximately $ million of the net proceeds from this offering to redeem all outstanding shares of its non-convertible preferred stock.
- The remaining net proceeds will be used for general corporate purposes, including working capital, operating expenses and capital expenditures.
- The company may also use a portion of the net proceeds to acquire or invest in businesses, products, services or technologies.
Disclaimer: This summary was generated by artificial intelligence and its accuracy is not guaranteed. The information provided here is for general informational purposes only and does not constitute financial advice, recommendation, or endorsement of any kind. It may contain errors or omissions. You should not rely on this information to make financial decisions. Always seek the advice of a qualified financial professional before making any investment or financial decisions. Use of this information is at your own risk.