Intapp Focuses on Cloud and Artificial Intelligence with Strong Growth

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Intapp Focuses on Cloud and Artificial Intelligence with Strong Growth

In the 2025 Fiscal Year First Quarter Earnings Call, Intapp (INTA), a leading provider of business applications for professional and financial services, reported a strong financial performance. CEO John Hall and Senior Vice President David Trone announced that the cloud Annual Recurring Revenue (ARR) reached $309 million, a 27% increase from the previous year, and constituted 74% of the total $417 million ARR. The company's focus on advanced artificial intelligence capabilities, including its cloud solutions and partnership with Microsoft, contributed to these robust results. Intapp completed the quarter with $0.21 in non-GAAP diluted earnings per share and $24.1 million in free cash flow.

Key Highlights

  • Intapp's cloud ARR grew 27% year-over-year to $309 million.
  • SaaS revenue increased 30% to $77 million.
  • Total revenue rose 17% to $119 million.
  • Non-GAAP gross profit margin increased to 76.3%.
  • The company reported $0.21 in non-GAAP diluted earnings per share.
  • Free cash flow amounted to $24.1 million, with cash and cash equivalents totaling $253.8 million.
  • At the end of the first quarter, there were 2,600 customers, 707 of which had an ARR of at least $100,000.
  • The cloud net revenue retention rate was reported at 119%.
  • Second-quarter SaaS revenue is expected to be between $79.5 million and $80.5 million.
  • Full-year SaaS revenue is anticipated to be between $327.6 million and $331.6 million.

Company Outlook

  • Second-quarter SaaS revenue is expected to be between $79.5 million and $80.5 million.
  • Total revenue for the second quarter is expected to fall between $120.5 million and $121.5 million.
  • Full-year SaaS revenue is forecasted to be between $327.6 million and $331.6 million.
  • Total revenue for the full year is projected between $495.5 million and $499.5 million.
  • Second-quarter non-GAAP operating income is anticipated to be between $14 million and $15 million.
  • Second-quarter non-GAAP earnings per share are expected to range from $0.15 to $0.17.

Negative Points

  • Net new ARR decreased on a year-over-year basis.
  • A decline was observed in major deal activity tied to a strategic realignment toward enterprise accounts.
  • A cautious approach is expected in the SaaS revenue forecast for the second half of the fiscal year.

Positive Points

  • Cloud offers and artificial intelligence capabilities continue to develop.
  • The partner ecosystem grew by 20%, reaching 135 partners.
  • International revenue increased to 34% of total revenue.
  • A program has been launched to assist firms in transitioning to cloud solutions.

Shortcomings

  • Despite overall growth, there was a slowdown in the growth rate of cloud ARR.

Q&A Highlights

  • The company is focused on a product-centric growth strategy, particularly in the area of generative artificial intelligence.
  • Management maintains confidence in future prospects, emphasizing a robust pipeline and strategic resource allocation.
  • The partnership with Microsoft is seen as a significant competitive advantage.
  • Executives expressed optimism about continuing momentum in fiscal 2025 despite macroeconomic concerns.

Intapp demonstrated strong performance in the first quarter of fiscal 2025 thanks to its strategic focus on cloud solutions and artificial intelligence capabilities. The company's partnership with Microsoft and growing partner ecosystem positions it well to capitalize on increasing demand for cloud-based services in the professional and financial sectors. Despite a slight slowdown in cloud ARR growth and a decline in net new ARR, Intapp remains optimistic about growth expectations and is actively working to enhance its offerings and customer engagement. With a healthy market and a solid application strategy, Intapp appears ready to maintain its momentum throughout the fiscal year.

InvestingPro Insights

Intapp's strong financial performance in the first quarter of 2025 is reflected in several key metrics from InvestingPro. The company’s 22.7% revenue growth over the last twelve months aligns with the 17% total revenue growth reported in the earnings call. This sustainable growth trend is further supported by an InvestingPro Tip indicating expected growth in net income this year.

Despite the current lack of profitability over the past twelve months, another InvestingPro Tip shows that analysts project the company will be profitable this year. This optimism is consistent with the company’s reported $0.21 non-GAAP diluted earnings per share for the first quarter and ongoing profitability guidance for the second quarter.

The market seems to recognize Intapp’s potential; its stock is trading near 52-week highs and has delivered a strong 59.43% return over the past three months. This performance highlights investors' confidence in Intapp's cloud-focused strategy and expanding AI capabilities.

Notably, it is important to point out that Intapp has more cash than debt on its balance sheet, providing financial flexibility to invest in growth initiatives and withstand potential economic uncertainties. This strong financial position is particularly significant considering the company's focus on expanding its cloud offerings and artificial intelligence capabilities.

For investors seeking a more comprehensive analysis, InvestingPro offers additional insights and forecasts. Currently, there are 11 additional InvestingPro Tips available for Intapp, providing deeper insights into the company's financial health and market position.

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