Sprout Social, Inc. reported significant financial developments in its latest 10-Q filing for the quarter ending September 30, 2024. The company achieved total revenue of $102.6 million for Q3 2024, marking a 20% increase from $85.5 million in Q3 2023. Subscription revenue, which constitutes 99% of total revenue, rose to $101.8 million from $84.8 million year-over-year. For the nine months ended September 30, 2024, total revenue reached $298.8 million, a 24% increase from $240.1 million in the same period of the previous year.

Gross profit for Q3 2024 was $79.4 million, up from $65.3 million in Q3 2023, resulting in a gross margin of 77%, slightly improved from 76% a year earlier. The company reported a net loss of $17.1 million for Q3 2024, a decrease from a net loss of $23.0 million in Q3 2023. For the nine-month period, the net loss was $47.6 million, compared to $46.4 million in the prior year.

Sprout Social's total assets as of September 30, 2024, were $388.8 million, down from $396.6 million at the end of 2023. Cash and cash equivalents increased significantly to $82.9 million from $49.8 million at year-end 2023. The company’s deferred revenue also grew to $149.2 million, up from $140.5 million at the end of 2023.

The company made strategic moves, including the acquisition of Tagger Media, Inc. for $144 million in cash, completed on August 2, 2023. This acquisition was funded through cash reserves and a $75 million draw from a revolving credit facility. The goodwill recorded from this acquisition amounted to $112.4 million, reflecting anticipated market expansion opportunities. Additionally, Sprout Social acquired Repustate, Inc. for $8.3 million in January 2023, enhancing its capabilities in social listening and AI.

Operating expenses for the nine months ended September 30, 2024, increased, particularly in research and development, which rose by 32% due to a 15% increase in headcount. Sales and marketing expenses also grew, driven by personnel costs and stock-based compensation linked to headcount increases. However, a change in the amortization period for sales commissions led to a reduction in sales and marketing expenses by $11.5 million for the nine-month period.

As of September 30, 2024, Sprout Social had approximately 30,000 customers, with notable growth in high-value customers contributing over $10,000 and $50,000 in Annual Recurring Revenue (ARR). The company continues to focus on expanding its sales force and enhancing its product offerings to drive future growth.