HubSpot Q2 2026 earnings: Revenue rises 20% as operating margins expand

HubSpot (NYSE: HUBS) reported Q2 2026 revenue of $911.7 million, up 20% as reported from $760.9 million, while diluted GAAP EPS improved to $0.86 from a loss of $0.06. Non-GAAP operating margin expanded by 3.3 percentage points to 20.3%, and operating cash flow increased to $222.8 million from $164.4 million. For the quarter ended June 30, 2026, subscription revenue rose 20% alongside growth in both customer count and average subscription revenue per customer.

Core earnings data

Nearly all of HubSpot’s absolute revenue growth came from subscriptions. Subscription revenue increased by approximately $149.5 million to $894.0 million, while professional services and other revenue rose by approximately $1.4 million to $17.7 million. Total revenue grew 17% in constant currency, compared with 20% as reported.

Profit conversion improved more quickly than revenue. Gross profit increased by approximately $112.2 million, while operating expenses rose by only about $44.2 million, moving HubSpot from a GAAP operating loss to operating income.

Subscription and customer performance

Subscription revenue remained HubSpot’s principal growth engine, increasing 20% to $894.0 million. Professional services and other revenue grew 8% to $17.7 million but remained a much smaller part of the business.

HubSpot ended the quarter with 306,446 customers, up 14%. Average subscription revenue per customer increased 4% as reported to $11,800, meaning the company expanded both its customer base and average customer spending.

Calculated billings reached $929.7 million, growing 14% as reported and 17% in constant currency. Although reported billings growth trailed the 20% reported revenue increase, both metrics grew 17% when measured in constant currency.

Profitability, cash flow, and balance sheet

HubSpot’s operating cash flow margin was approximately 24.4%, up from about 21.6% in the prior-year quarter. Non-GAAP free cash flow margin also improved to approximately 18.4% from 15.3%, indicating that the operating-margin expansion translated into stronger cash generation.

Cash, cash equivalents, and short- and long-term investments totaled $1.4 billion at June 30, 2026. HubSpot repurchased $531.9 million of common stock during the quarter. On August 3, the board authorized an additional repurchase program of up to $1.0 billion over 24 months, although the authorization does not require the company to repurchase a specified number of shares.

Operating leverage outweighed subscription margin pressure

HubSpot’s subscription margins declined even as companywide operating margins improved. GAAP subscription margin fell to 83.7% from 85.7%, while non-GAAP subscription margin decreased to 85.3% from 87.1%. The release did not identify a specific cause for this compression.

Operating expenses provided a larger offset. GAAP research and development expense declined to $225.8 million from $237.3 million, and general and administrative expense fell to $82.9 million from $85.0 million. Sales and marketing expense increased to $397.7 million from $339.9 million, but decreased as a percentage of revenue to 43.6% from 44.7%.

As a result, total operating expenses grew approximately 6.7%, substantially slower than revenue. Both GAAP and non-GAAP operating margins expanded, showing that the improvement was not solely a product of lower stock-based compensation, although stock-based compensation remained significant at $128.5 million.

Earnings guidance

As of August 5, 2026, HubSpot issued guidance for Q3 and the full year. The Q3 outlook calls for 14% reported revenue growth and 15% constant-currency growth, representing a moderation from Q2’s respective growth rates of 20% and 17%. The company expects a 20% non-GAAP operating margin in Q3 and 21% for the full year.

Management’s view

CEO Yamini Rangan said HubSpot is changing its products, pricing, and go-to-market model to accelerate its AI transformation. Management believes scaling companies want measurable outcomes and predictable pricing when adopting AI, and said HubSpot’s agents are already producing measurable results for go-to-market teams. Execution of these pricing and product changes will be central to the company’s effort to convert AI adoption into sustained growth.

Recent insider transactions

The provided six-month insider summary reports purchases of 221,559 shares across 21 transactions and sales of 52,898 shares across eight transactions. That produced reported net purchases of 168,661 shares, while total insider holdings were 1.85 million shares.

Among the 10 latest reported transactions, eight were zero-price stock awards to directors and two were indirect sales by director Brian P. Halligan.

These records describe the transactions but do not establish the insiders’ views on HubSpot’s outlook.

Risks investors should monitor

• Growth is expected to moderate: Q3 guidance calls for 14% reported revenue growth, below Q2’s 20%, while reported calculated billings grew 14% in Q2.
• Subscription margins are declining: Both GAAP and non-GAAP subscription margins contracted, which could offset operating leverage if the trend persists.
• AI and pricing changes carry execution risk: HubSpot is simultaneously modifying its products, pricing, and go-to-market approach, making customer adoption and monetization important measures of progress.
• Adjusted profit remains well above GAAP profit: Q2 non-GAAP operating income was $185.3 million versus GAAP operating income of $43.3 million, with $128.5 million of stock-based compensation representing the largest adjustment.
• Repurchases are substantial relative to cash generation: Q2 share repurchases of $531.9 million exceeded quarterly non-GAAP free cash flow of $167.9 million, while the board has authorized another program of up to $1.0 billion.

Summary

HubSpot’s Q2 2026 results combined 20% reported revenue growth with a return to GAAP operating profitability, wider non-GAAP operating margins, and higher cash flow. Subscription revenue, customer growth, and increased average revenue per customer supported the top line, while slower expense growth drove operating leverage despite lower subscription margins. The main issues to monitor are the expected Q3 growth moderation and HubSpot’s execution of its AI product, pricing, and go-to-market changes.