Rapid7 Focuses on Simplifying View for Security Teams

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According to a recent report, the global security analytics market is expected to grow from $12 billion in 2021 to $25.4 billion by 2026 at a CAGR of over 16%. The continued demand for prioritization of network-based threats with actionable intelligence to avert data losses and prevention of onward intrusion are leading to this high growth rate. Rapid7 (NASDAQ:RPD), a leading provider of security analytics solution is addressing these market demands with addition of new features in its core products.

Rapid7’s Financials

Rapid7’s revenues for the second quarter grew 32% to $167 million, ahead of the market’s expectations of $164.36 million. Non GAAP net loss was $0.56 per share compared with the Street’s forecast of a loss of $0.59 per share.

By segment, revenues from products grew 34% to $159 million and professional services revenues grew 15% to $8.3 million.

Among key metrics, its total ARR per customer recorded a growth of 18% and its total customers grew 14% over the year.

For the first quarter, Rapid7 forecast revenues of $175-$177 million and a net income of $0.03-$0.06 per share. The Street was looking for revenues of $177.49 million and an EPS of $0.13 per share. Rapid7 expects to end the current year with revenues of $686-$690 million and earnings of $0.08-$0.15 per share. The market had forecast revenues of $689.51 million and earnings of $0.11 per share.

Rapid7’s Growth Focus

Rapid7 continued to improve upon its cloud-native security platform, InsightCloudSec. During the quarter, it announced new cloud workload protection capabilities, which include native vulnerability assessment for container and Kubernetes environments and Rapid7’s vulnerability assessment technology delivered via an agentless experience that is purpose built for cloud-native environments.

Rapid7 believes that as organizations increasingly move to public cloud infrastructure-as-a-service (IaaS), the overall number of IaaS workloads will grow rapidly. Robust cloud workload protection in InsightCloudSec will allow security and risk management leaders to assess their public cloud environments for known vulnerabilities and leverage that context to quickly and effectively reduce risks related to those critical workloads. The vulnerability assessment for containers and Kubernetes enables customers to layer vulnerability intelligence with configuration and identity context already available in InsightCloudSec. This feature gives the security teams a deeper understanding of their cloud environments to better prioritize and remediate potential risks within those environments.

It also added today new layered context capabilities within the InsightCloudSec offering. The addition of layered context functionality allows security teams to have access to a consolidated, unified, and real-time view of risk signals, including misconfigurations and public exposure across their environment. The rapid adoption of various cloud technologies within an organization has resulted in understanding risk gaps of the security teams. Rapid7 is able to address this by providing these security teams with access to a resource-oriented consolidated view of risk in their cloud including services, hosts, containers, and serverless environments.

Its stock is trading at $54.6 with a market capitalization of $3.25 billion. It had peaked to a record high of $145.00 in November last year. It fell to a 52-week low of $52.05 in August this year.

Disclosure:?All investors should make their own assessments based on their own research, informed interpretations, and risk appetite. This article expresses my own opinions based on my own research of product-market fit, channel execution, and other factors. My primary interest is in product strategy. While this may have bearing on stock movements, my writings tend to focus on long-term implications. The information presented is illustrative and educational, but should not be regarded as a complete analysis nor recommendation to buy or sell the securities mentioned herein. I am not a registered investment adviser and I am not receiving compensation for this article.

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