Cellebrite’s Q3 Highlights: ARR Jumps 19% and Profit Margins Impress as Platform Expansion Takes Center Stage
Recurring Revenue Momentum Powers Growth
Cellebrite (NASDAQ:CLBT) delivered an 18% revenue increase for the third quarter of 2025, bringing in $126.0 million. Annual recurring revenue (ARR) stood out, climbing 19% year-over-year to $439.8 million—a strong signal that the company’s subscription-first strategy is delivering steady results. Dollar-based net retention of 117% suggests not only that customers are sticking around, but that they’re expanding their relationship with Cellebrite over time.
| Q3 2025 (USD, in thousands) | Change vs. Q3 2024 |
|---|---|
| Revenue | +18% |
| Subscription Revenue | +21% |
| Annual Recurring Revenue (ARR) | +19% |
| Dollar-based Net Retention | 117% |
| Non-GAAP Gross Margin | 84.5% |
| Adjusted EBITDA Margin | 29.9% |
Margins and Cash Flow Paint a Healthy Financial Picture
Cellebrite’s operating performance continues to strengthen. Adjusted EBITDA reached $37.7 million, with a margin near 30%. The company also reported a non-GAAP net income of $36.9 million and generated nearly $30 million in free cash flow this quarter alone—up significantly from last year’s levels.
| Key Profitability Metrics (Q3 2025) | Q3 2025 | Q3 2024 |
|---|---|---|
| Non-GAAP Net Income ($M) | 36.86 | 31.85 |
| Adjusted EBITDA ($M) | 37.74 | 31.33 |
| Free Cash Flow Margin | 23.8% | 37.3% |
| GAAP Gross Margin | 83.9% | 85.5% |
Product Innovation Accelerates: AI-Powered and Cloud-Based Expansion
Innovation remains a clear priority for Cellebrite. The Autumn 2025 release saw a reimagined Guardian suite and announced the upcoming Guardian Investigate—a SaaS, agentic AI-driven investigation tool planned for early 2026. Platform enhancements focused on greater integration, streamlined collaboration, and advanced analytics across multiple evidence types.
Continued upgrades to flagship Inseyets solution improved both iOS and Android evidence collection and review, broadening Cellebrite’s market relevance. Meanwhile, integration of Corellium’s virtualization offerings is expected to further deepen the company’s value proposition in digital intelligence.
Strong Go-to-Market Performance and Leadership Stability
Business expansion was notable in U.S. Federal accounts and Latin American regions, with increased subscription-based revenue and key contract wins. Management changes included the appointment of Holly Windham as General Counsel and Chief Compliance Officer—adding expertise in cybersecurity, cloud, and public sector domains.
Outlook: Durable Growth with Margin Expansion in Sight
Looking forward, Cellebrite’s guidance remains upbeat. Full-year 2025 expectations include:
| Metric | Full-Year 2025 Guidance |
|---|---|
| Revenue | $470M – $475M (up 17–18%) |
| ARR | $460M – $475M (up 16–20%) |
| Adjusted EBITDA | $124M – $127M |
| Adjusted EBITDA Margin | 26–27% |
| Free Cash Flow Margin | ~30% |
Cellebrite’s robust customer retention, growing subscription mix, and clear commitment to innovation provide visibility for continued growth. While sector headwinds and integration risks from the pending Corellium acquisition warrant ongoing attention, management’s focus on expanding U.S. Federal business and building new AI-powered capabilities may further support durable expansion through 2026.
Takeaway: Sustained Subscription Growth and Expanding Platform Fuel Confidence
Cellebrite is demonstrating consistent top-line growth, stable or rising profit margins, and disciplined cash flow generation—backed by clear innovation milestones and expanding use cases for digital investigation. For those watching the digital intelligence landscape, Cellebrite’s combination of financial discipline and product momentum merits attention in the quarters ahead.
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