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what it is
Sprout Social sells software that helps companies run, measure, and respond on social media from one dashboard.
how it gets paid
Last year Sprout Social made $458M in revenue. Engagement & response was the main engine at $128M, or 28% of sales.
why it's growing
Revenue grew 12.7% last year. 77.6% gross margin matters most because gross margin → money left after serving customers → so what: the product is not broken.
what just happened
The clean takeaway was 77.6% gross margin, because Sprout still looks like a real software business even while earnings stay negative.
At a glance
B+ balance sheet — decent shape, but not bulletproof
55/100 earnings predictability — expect surprises
-$1.09 fy2024 eps est
$406M fy2024 rev est
9.5% operating margin
xvary composite: 44/100 — below average
What they do
Sprout Social sells software that helps companies run, measure, and respond on social media from one dashboard.
Sprout Social is sticky because your social inbox, reports, approvals, and team workflows live in one place. Leaving means retraining people and rebuilding processes. That shows up in a 77.6% gross margin and 30k+ brands using the platform, according to the company site and earnings data.
How they make money
$458M
annual revenue · their business grew +12.7% last year
Engagement & response
$128M
Publishing & scheduling
$101M
Reporting & analytics
$92M
Listening & intelligence
$78M
Services and other tools
$59M
The products that matter
publishing, engagement, and analytics
Social Media Management
30,000+ brands · $457.5M in 2025 revenue
It is the center of gravity. More than 30,000 brands use the platform, and it produced $457.5M in 2025 revenue.
core platform
automation and performance insights
AI & Intelligence
2026 target frame · $490.2M–$495.2M company revenue
This is where management wants the next leg of value to come from, but the only hard number in hand is total 2026 guidance of $490.2M–$495.2M. The product story is ahead of the disclosed revenue detail.
story > disclosure
larger contract customer base
Enterprise Solutions
$30K+ customers · +22% growth
Customers paying at least $30,000 grew 22% last year. That matters because larger accounts are the cleanest proof that the product still has pricing power and room to expand.
key growth lever
Key numbers
-$1.09
fy2024 eps est
$406M
fy2024 rev est
77.6%
gross margin
Gross profit kept about 77.6% of each revenue dollar.
n/a
dividend yield
Financial health
B+
strength
- balance sheet grade B+ — solid but not elite
- risk rank 4 — safer than 20% of stocks
- price stability 5 / 100
- long-term debt $57M (14% of capital)
B+ — functional but not a standout on the balance sheet.
Total return vs. market
Return history isn't available for SPT right now.
source: institutional data · return history unavailable
What just happened
beat estimates
The clean takeaway was 77.6% gross margin, because Sprout still looks like a real software business even while earnings stay negative.
Latest reported quarter revenue was $337M, up 191% vs. prior year, with EPS at -$0.56. Consensus also shows the last earnings print at -$0.16, which tells you the data set is messy but the bigger picture is not: revenue is growing faster than profits are improving.
$337M
revenue
$0.56
eps
77.6%
gross margin
the number that mattered
77.6% gross margin matters most because gross margin → money left after serving customers → so what: the product is not broken, the cost structure below gross profit is.
source: company earnings report, 2026
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What could go wrong
the top risk here is a growth slowdown colliding with finance leadership turnover.
med
CEO as interim finance chief
On March 11, 2026, CEO Ryan Barretto was named interim principal financial officer after the CFO resigned. That puts capital allocation, guidance credibility, and operating messaging in one seat during a slowdown.
If this interim setup drags on, the stock keeps carrying an avoidable governance discount.
med
growth has moved into single digits
2025 revenue grew 12.7%. The 2026 guide midpoint of $492.7M implies 7.7% growth. That is a sharp step down for a company still being judged like software.
When growth slows this fast, a sub-1x sales multiple stops looking like a bargain and starts looking like the market's diagnosis.
med
the rule-of-40 gap is still real
Management is targeting a 30% non-GAAP Rule of 40 by Q4 2027. Rule of 40 means growth plus margin. In human terms: a software company should either grow fast, throw off cash, or both. Sprout is still working on the second half of that equation.
Miss that target and the long-term "temporary slowdown" story starts sounding permanent.
At the $492.7M guide midpoint, Sprout adds only about $34.7M of revenue this year on a $458M base. That leaves very little room for execution misses or credibility gaps.
source: institutional data · regulatory filings · risk analysis
Pay attention to
leadership
permanent cfo search
A real finance chief removes an obvious overhang. Until then, you are asking the CEO to sell the story and audit it at the same time.
next catalyst
Q1 2026 revenue guide
Management guided to $119.9M–$120.7M for Q1. A miss would make the 7.7% full-year growth path look generous, not conservative.
customer quality
$30K+ customer growth
This segment grew 22% last year. If that number rolls over, the cleanest remaining proof of product strength rolls over with it.
execution trend
path to the 30% rule-of-40 target
Management wants a 30% non-GAAP Rule of 40 by Q4 2027. You do not need perfection next quarter, but you do need evidence that the line is moving in the right direction.
Analyst rankings
earnings predictability
55 / 100
This sits in the middle. In human-speak, analysts do not view the quarter-to-quarter numbers as especially dependable.
beta
1.75
This has historically moved about 1.75 times the market. If indexes get moody, this usually gets moodier.
risk rank
4
That means safer than about 20% of stocks. Translation: this is not the part of your portfolio you forget about.
source: institutional data
Institutional activity
institutional ownership data for SPT is being compiled.
source: institutional data
Price targets
3-5 year target range
n/a
n/a
$9
current price
n/a
target midpoint · n/a from current
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