Snapshot
Procore Technologies, Inc. reported $324M of revenue in Q2 2025, up 13.9% year over year, with diluted EPS of $-0.14 and an operating margin of -9.3%.
- Revenue
- $324M
- YoY growth
- +13.9%
- Diluted EPS
- $-0.14
- Operating margin
- -9.3%
What management said
- •Comments made on this call include forward-looking statements regarding, among other things, our financial outlook, go-to-market transition, platform and products, customer demand, operations, and macroeconomic and geopolitical conditions.
- •Some highlights include revenue grew 14% year-over-year, non-GAAP operating margins increased quarter-over-quarter to 13%.
- •We saw continued progress with our go-to-market transition, positioning Procore for efficient growth as we build deeper and lasting partnerships with our customers.
- •egg producer and one of the nation's largest barn builders experiencing significant CapEx growth.
- •In Q2, they selected Procore to standardize operations and enable their aggressive growth targets.
- •In that time, HITT scaled its business from $800 million to more than $8 billion in revenue with Procore as a constant in their technology stack supporting their impressive growth.
- •In Q2, they expanded their Procore footprint with additional ACV driven by a growing backlog, primarily due to their leadership position building data centers across the country.
- •FedRAMP applies to certain federal agencies and contractors, and this designation is an important milestone towards enhancing our ability to serve this segment of the federal market more broadly.
- •The main topics I would like to cover today are our Q2 financial results, additional color on the quarter, and our outlook.
- •Our Q2 international revenue grew 13% year-over-year and was impacted by currency headwinds.
- •On a year-over-year basis, FX contributed approximately 3 points of headwind to international revenue growth.
- •Q2 non-GAAP operating income was $44 million, representing a non-GAAP operating margin of 13%.
What went well
- •Q2 revenue grew 14% year-over-year to $324 million, with non-GAAP operating margin increasing quarter-over-quarter to 13%.
- •Six- and seven-figure deals grew 21% year-over-year, resulting in more than 2,500 customers contributing greater than $100,000 in ARR.
- •Current RPO grew 21% year-over-year, with normalized growth in the mid-teens.
- •Cross-sell improved as a share of expansion, shifting the mix from roughly 80/20 to 70/30 toward cross-sell, driven primarily by higher attach of the financials suite.
- •The company introduced Procore Helix (its intelligence layer with Assist, Agent Builder, and Developer Studio) and announced acquisitions of Novorender and Flypaper for a 3D streaming BIM engine.
- •Procore secured notable wins and expansions including Clayco, HITT Contracting (expansion), Calpine, and a Fortune 150 utility holding company, and earned a FedRAMP in-process designation.
What went wrong
- •Management described the macroeconomic environment as still depressed and consistent with the prior quarter, a steady headwind.
- •International revenue was impacted by approximately 3 points of FX headwind, growing 13% year-over-year (16% constant currency).
- •Free cash flow came in a little light versus some expectations in a seasonally softer quarter, though management said there was nothing to read into the specific quarter.
Guidance changes
| Metric | Period | Previous | Current | Change |
|---|---|---|---|---|
| Revenue | Q3 2025 | None | $326 million-$328 million (10%-11% YoY growth) | new |
| Non-GAAP operating margin | Q3 2025 | None | 13%-13.5% | new |
| Revenue | Full-year 2025 | None | $1.299 billion-$1.302 billion (13% YoY growth) | raised |
| Non-GAAP operating margin | Full-year 2025 | None | 13%-13.5% (300-350 bps expansion) | maintained |
Performance breakdown
| Metric | YoY change | Reason |
|---|---|---|
| Total revenue | +14% to $324 million | Strong new logo ARR growth led by general contractor, owner, and public sector motions, plus improved expansion mix. |
| Non-GAAP operating margin | 13% (up 300 bps QoQ) | Continued profitability improvement, with operating margin guide maintained for conservatism around items like FX. |
| International revenue | +13% (+16% constant currency) | Approximately 3 points of FX headwind. |
| Current RPO | +21% | Solid quarter benefiting primarily from longer average contract duration; normalized growth in the mid-teens. |
| Six- and seven-figure deals | +21% | Strong large-deal quarter. |
Earnings call themes & trends
| Topic | Previous mention | Current period | Trend |
|---|---|---|---|
| AI innovation | Earlier AI positioning | Procore Helix intelligence layer introduced (Assist, Agent Builder, Developer Studio) with out-of-the-box agents in limited release; customer hackathon demonstrated demand | building |
| Go-to-market transition | Announced a year prior with pulled-forward investments | On track and going about as planned; through the peak of disruption with improving conversion, deal cycles, and low attrition | progressing |
| Construction macro environment | Depressed / challenging | Surprisingly the same as last quarter; customers resilient and optimistic despite tariff noise | stable but challenged |
| Cross-sell mix | Roughly 80/20 volume-to-cross-sell | Shifted to 70/30 with cross-sell increasing, primarily from higher financials suite attach | improving |
| Rule of 40 / FCF margin path | Investor day targets of 25% medium-term and 40% long-term FCF margins | Fiscal 2026 Rule of 40 improvement expected to be driven by higher profitability; increased confidence in milestones | on track |
Q&A summary
Are customer conversations showing initial adoption of AI like Helix, and is standardization across workflows reinforcing Procore as the system of record?
CEO Tooey Courtemanche said the customer hackathon was exciting and eye-opening, with customers building agents for use cases the company couldn't have imagined; more demonstrated value should drive Agent Builder adoption. CFO Howard Fu added the current focus is getting these tools into customers' hands to learn how they add value before scaling the adoption curve.
On the path to Rule of 40 next year, why will more of it come from margin expansion?
Fu said they wanted to reiterate commitment to margin expansion for 2025 and 2026, with a good setup since go-to-market investments were pulled forward into Q1. He cautioned against getting ahead on 2026 revenue; Rule of 40 expansion next year will come from profitability, supported by durable growth and go-to-market/AE productivity leverage.
Does Procore need to consider pricing models beyond construction-volume-based pricing?
Courtemanche said the company already has flexibility (e.g., seat-based licenses for self-perform products) and aims to meet customers where they are, with some owner-segment preference for per-seat models. ACV is not sacrosanct but works well because customers run their businesses off anticipated construction volume in their backlogs.
What gives you confidence the larger cross-sell share reflects the new go-to-market model working rather than weaker upsell volume?
Fu said the cross-sell benefit came from a broad range of efforts including technical specialists online for two quarters, broader go-to-market changes, and product roadmap progress. Courtemanche corrected any assumption that volume was down — volume was not down, cross-sell was up — and cited many C-level conversations praising the new model.
What is the trend line in normalized cRPO and the convergence with revenue growth?
Fu said the longer-duration impact largely came from Q4 into Q1, so it should start to normalize from Q2 as that shift anniversaries. Normalized cRPO is in the mid-teens range, expected to normalize around there toward the back part of the year.
How are customers thinking about tariff impact and readiness to take on projects?
Courtemanche said customers are extremely resilient and build flexibility into their contracts to handle tariffs; tariffs are the issue du jour but customers remain very optimistic about the future across the board.