Episode Details

HubSpot (HUBS) Q2 2026 — Q2 2026 (quarter ended June 30, 2026): non-GAAP EPS $3.26 vs a $3.02 bar (+8%), up 49% y/y; GAAP EPS $0.86 vs -$0.06. Revenue $911.7M (+20% reported, +17% cc) vs $898M expected. Non-GAAP operating margin 20.3% vs 17.0%. The 8-K was accepted 4:15 p.m. ET on Aug 5 (AMC), so the Aug 6 close of $202.43 IS the reaction - down 19.1% from $250.21, the largest one-day fall in HubSpot's 12 years as a public company. HubSpot beat on every printed line - revenue $911.7M vs $898M, non-GAAP EPS $3.26 vs $3.02, operating margin up 3.3 points to 20.3% - and had the worst day of its public life. The reason is three press releases and one subtraction. In February the company guided 2026 revenue to $3.69-3.70B; in May it raised that to $3.700-3.708B; on August 5 it cut it to $3.678-3.686B, below where the year started. They beat their own Q2 guide midpoint by $14.2M and took $36.2M out of the implied second half - $2.55 of future revenue removed for every $1 of the beat. The as-reported full-year growth rate never moved (18% in May, 18% in August) while the constant-currency rate fell from 17% to 16%: a currency tailwind held the optics flat while the underlying number was cut. And the 'EPS raise' is the share count - full-year non-GAAP operating income guidance is IDENTICAL at $762-766M, while implied net income fell $14.0M and the assumed diluted share count went 51.8M to 50.0M. We charge stock-based compensation as a real cost, in full, and still get to about $255. THE CALL: BUY (3/5, A REAL CUT, PRICED AS THOUGH GROWTH IS OVER) — base-case value ~$255.0 vs ~$202.43 today. KEY METRICS: - CALL: BUY 3/5, fair value ~$255 vs the $202.43 reaction close (+26%). Bull $400, base $289, bear $180. Post-print Street targets cluster near $220. - Non-GAAP EPS $3.26 vs $3.02 (+49% y/y). Revenue $911.7M, +20% (+17% cc). Non-GAAP op margin 20.3% vs 17.0%. FCF $167.9M. Buyback $531.9M; +$1.0B authorized. - But: FY revenue guide CUT to $3.678-3.686B, below February's. Q3 guided +14% after +23% and +20%. Net adds 7,000 vs 9-10,000; new run rate 5,000-6,000. NRR 102%. What to watch: UP: quarterly customer additions back above 7,000; net revenue retention holding 102% or better through the December quarter; the April pricing reset producing measurable credit revenue rather than usage alone; stock-based compensation falling below 12% of revenue. DOWN: additions stuck at 5,000 into 2027; net revenue retention printing below 100%; the full-year guide cut again on November 4; or the buyback being slowed to protect the cash balance. Also on YouTube: @ChargedAlpha DISCLAIMER: For informational and educational purposes only. Not financial advice. Do your own research before any investment decision.