Tenable forecasts $1.084B-$1.087B 2026 revenue as Tenable One reaches 59% of new business

Earnings Call Insights: Tenable Holdings, Inc. (TENB) Q3 2026

Management View

• "We delivered excellent results in the third quarter" (Co-CEO Stephen Vintz), while pointing to "leading indicators" that "show inflection and signal durability of growth ahead," including "net dollar expansion rate accelerated to 107%, up from 106% in Q2" and "Tenable One reached a record 59% of new business, up from 50% in Q2."
• "Earlier this year, we said AI would surface more vulnerabilities and exposures faster. That's playing out now" (Co-CEO Vintz), citing "PHP2Shell" and adding that "customers turned to Hexa, and we've seen prompt volume increase dramatically by as much as 5x."
• "We also expanded Tenable Hexa AI" (Co-CEO Vintz) and said "Hexa now works as a coordinated fleet of agents that continuously identify critical exposures, orchestrate remediation and verify fixes even when security teams are offline."
• "Q3 was our best quarter ever for Tenable One new logos" (Co-CEO Mark Thurmond), adding that "we ended the quarter with more than 5,000 customers on Tenable One" and that "platform expansion was the primary driver of our acceleration in net dollar expansion rate and average deal size."
• "Revenue for the quarter was $276.4 million" (CFO Matthew Brown) and "we are once again raising our full year outlook, reflecting the growing momentum we're seeing in the business."

Outlook

• "We are raising our full year 2026 guidance range for revenue to $1.084 billion to $1.087 billion" (CFO Brown) and "for Q4, we expect revenue to be in the range of $277 million to $280 million."
• "We are also raising our full year 2026 guidance range for non-GAAP operating income to $270 million to $273 million" (CFO Brown) and "we expect non-GAAP income from operations for Q4 to be in the range of $67.1 million to $70.1 million."
• "We are raising our full year 2026 guidance range for non-GAAP diluted earnings per share to a range of $2.16 to $2.19" (CFO Brown) and "we expect non-GAAP diluted earnings per share for Q4 to be in the range of $0.56 to $0.58 per share."
• The analysts-estimates JSON in the prompt did not provide a valid fiscalQuarter format (Q1-Q4), so no estimates comparison is included here.

Financial Results

• "Revenue for the quarter was $276.4 million, representing growth of 9.5% year-over-year" (CFO Brown), and "our percentage of recurring revenue remained high at 95% for the quarter."
• "We added 413 new enterprise customers in the quarter and added 39 net new 6-figure accounts" (CFO Brown), while "new 6-figure account annual contract value" was "up 18% year-over-year."
• "Non-GAAP income from operations for the quarter was $74.9 million or 27.1% of revenue" (CFO Brown) and "non-GAAP earnings per share for the quarter was $0.63," which he said "includes a onetime discrete tax benefit that increased earnings per share by $0.03."
• "We generated $69.4 million of unlevered free cash flow" (CFO Brown) and "ended the quarter with cash and short-term investments of $495.3 million."
• "During the quarter, we raised $800 million in a convertible note offering" (CFO Brown), "repurchased 5.3 million shares for $170.5 million," and said "on October 13, we closed a revolving line of credit, giving us access to $400 million in additional liquidity."

Q&A

• Michael Cikos, Needham: asked to segment Tenable One adoption between new logos and existing customers; Co-CEO Thurmond said Tenable One momentum came from "an incredible quarter in regard to net new logos landing on Tenable One" and that "hundreds of VM customers transitioned over to Tenable One."
• Michael Cikos, Needham: asked about endpoint-vendor competition and bundling; Co-CEO Thurmond responded "we didn't see any change whatsoever from a competitive dynamic in Q3" and said wins came from "the depth and breadth of the platform" and that "Hexa has become a really big driver."
• Rudy Kessinger, D.A. Davidson: asked whether increased scanning could change pricing; Co-CEO Vintz said "our pricing and packaging has evolved considerably" and added, "We don't want to do it based on the number of scans. We don't want to discourage usage."
• Roger Boyd, UBS: asked whether higher Hexa prompt volume could pressure gross margin; CFO Brown said "Hexa is not putting pressure on our gross margins" and that "there's an add-on SKU that protects us from a margin perspective."
• Conner Weed (for Patrick Colville), Scotiabank: asked what supported the guidance raise; CFO Brown cited "the performance that we saw in Q3" plus "the pipeline growth that we're seeing in Q4" and said "we think [CCB] probably ticks up slightly in Q4."
• Joshua Tilton, Wolfe Research: asked about Hexa usage after enabling continuous workflows; Co-CEO Vintz said "we saw a dramatic increase" in usage and described customers using Hexa so that "what used to take... days, now it gets done in hours and sometimes even minutes."
• Richard Poland, Wells Fargo: asked about Tenable One uplift and whether focus is conversion first; Co-CEO Thurmond said "brand-new customers are coming directly into the platform and they're spending more" and that "Average customer value is double in the platform what it is versus stand-alone SKUs."

Sentiment Analysis

• Analyst tone was slightly positive, emphasizing improved growth signals and sustainability questions, including "Good to see pipeline conversion" (Roger Boyd, UBS) and requests for segmentation, pricing evolution, and federal contribution quantification.
• Management tone was positive and confident in both prepared remarks and Q&A, using language such as "excellent results" (Co-CEO Vintz) and "we are once again raising our full year outlook" (CFO Brown), while describing competitive conditions as unchanged and win rates improving.
• Compared with Q2, management continued the "post-Mythos" urgency framing but shifted to more concrete conversion language in Q3, including "pipe build is turning to conversion" (Co-CEO Thurmond) versus Q2’s "customer conversations convert into action" (Co-CEO Thurmond).

Quarter-over-quarter Comparison

• Q3 emphasized acceleration in expansion and platform mix, with "net dollar expansion rate accelerated to 107%, up from 106% in Q2" and "Tenable One reached a record 59% of new business, up from 50% in Q2" (Co-CEO Vintz).
• Guidance moved higher again, with full-year revenue now "$1.084 billion to $1.087 billion" in Q3 (CFO Brown) versus Q2’s "$1.075 billion to $1.081 billion" (CFO Brown).
• Analyst focus broadened from Q2’s heavier emphasis on early Hexa traction and competitive changes to Q3 questions on pricing mechanics under higher vulnerability velocity, Hexa margin protection, and parsing enterprise adds versus Tenable One “record new logos.”

Risks and Concerns

• "It's too early to quantify right now" (Co-CEO Vintz) when asked about business impact from PHP2Shell, while noting security teams are "buried right now trying to figure out what this means for them internally."
• "We don't want to do it based on the number of scans" (Co-CEO Vintz) when discussing monetizing increased scanning frequency, framing a constraint around pricing design and customer usage incentives.
• "Once customers have run out of their allotment within the platform, there's an add-on SKU that protects us from a margin perspective" (CFO Brown), describing the company’s mitigation approach for higher Hexa usage.

Final Takeaway

Management framed Q3 as a quarter where earlier AI-driven exposure-management momentum converted into accelerating platform mix and retention, highlighted by 59% of new business coming from Tenable One and net dollar expansion rising to 107%. Executives tied heightened vulnerability velocity and the PHP2Shell event to increased Hexa engagement, while the CFO paired the operating results with a raised full-year outlook and a capital structure update centered on a new $800 million convertible issuance, expanded liquidity, and continued share repurchases.

Read the full Earnings Call Transcript

Seeking Alpha's Disclaimer: This article was automatically generated by an AI tool based on content available on the Seeking Alpha website, and has not been curated or reviewed by humans. Due to inherent limitations in using AI-based tools, the accuracy, completeness, or timeliness of such articles cannot be guaranteed. This article is intended for informational purposes only. Seeking Alpha does not take account of your objectives or your financial situation and does not offer any personalized investment advice. Seeking Alpha is not a licensed securities dealer, broker or US investment adviser or investment bank.