5. HubSpot, Inc. (NYSE:HUBS)
Short Interest: 1.71%
Number of Hedge Fund Holders: 80
HubSpot (NYSE:HUBS) is an adtech company that provides a customer platform for businesses to grow and connect. Its unified platform offers prime connection for customer-facing teams. The platform includes artificial intelligence-powered engagement hubs, a connected ecosystem with more than 1,500 app marketplace integrations, a smart customer relationship management product (CRM), a community network, and educational content.
The company’s engagement hubs include Sales Hub, Marketing Hub, Operations Hub, Service Hub, Content Management System (CMS) Hub, and Commerce Hub. These hubs allow companies to engage and attract clients through the customer lifecycle. HubSpot’s Smart CRM is its primary layer of operations. It brings customer data to AI, powering the customer platform with unified customer profiles and tools to manage and govern teams and business processes. It specializes in relating and selling to mid-market business-to-business (B2B) companies. HubSpot (NYSE:HUBS) functions on a subscription basis.
The company is on the path to profitability. Its Q2 2024 revenue grew by 21% year over year in constant currency, and its total customers increased to 228,000 individuals across the globe. 11,200 net customer additions in Q2 drove the company’s customer growth. Its pricing improvements and product enhancements have led the company to the low end of the market. The company has also made it easy to get started with HubSpot (NYSE:HUBS), removing friction and streamlining the checkout process so consumers can make clear decisions about the seats and functionality of their choice. HubSpot (NYSE:HUBS) introduced its pricing model changes in March, lowering the price point to get started, removing seat minimums, and creating a core seat for customers who wish to edit CRM records. In turn, it recorded solid expansion trends with a multi-point net revenue increase in the third month of use. Customers on the new pricing model have the power to purchase precisely what they need, expanding as they go. This is one of the primary reasons behind its increasing popularity.
HubSpot (NYSE:HUBS) is also driving innovation with its Spring Spotlight product launches. As part of its first Spring Spotlight, the company rolled out significant updates to service up and launched Content Hub. Its ultimate goal was to provide an AI-powered content marketing solution to help marketers create and manage content. Public response to this facet has been promising, with the attach rate for Content Hub to Marketing Hub tripling since its launch. It now stands at around 50% for new marketing hub wins. Innovative AI features like AI blogs, content remixes, and brand voice are the primary drivers of the high attach rate.
Renowned brands like TripAdvisor, Morehouse College, and World Wildlife Fund for Nature, are leveraging HubSpot content solutions for growth, highlighting the company’s potential in product innovation and profitability. Hubspot ranks fifth on our list of the worst adtech stocks to buy now.
