SEMrush Holdings, Inc.

All lines will be muted during the presentation portion of the call with an opportunity for questions and answers at the end. If you would like to ask a question, please press star 1 on your telephone keypad. I would now like to pass the conference over to our host, Brinley Johnson.

Good morning, and welcome to SEMrush Holdings' third quarter 2025 conference call. We'll be discussing the results announced in our press release issued after market close on November 5, 2025. With me on the call today is our CEO, Bill Wagner, and our CFO, Brian Mulroy. Today's call will contain forward-looking statements which are pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include, but are not limited to, statements concerning our expected future business and financial performance and financial condition, expected growth, adoption, and existing and future demand for our existing and any new products and features, our expected growth of our customer base and specific customer segments, the continued development of our products, industry, and market trends, our competitive position, market opportunities and growth strategies, sales and marketing activities and strategies, future spending and incremental investments, our guidance for the fourth quarter of 2025 and the full year 2025, and statements about future pricing and operating results, including margin improvement, revenue growth, and profitability, assumptions regarding foreign exchange rates and plans. Forward-looking statements are statements other than statements of fact and can be identified by words such as expect, can, anticipate, could, believe, seek, or will. These statements reflect our views as of today only and should not be relied upon representing our views at any subsequent date, and we do not undertake or any duty to update these statements. Forward-looking statements address matters that are subject to risks and uncertainties that could cause actual results to differ materially from these forward-looking statements. For a discussion of the risks and important factors that could affect our actual results, please refer to our most recent annual report on Form 10-K, filed with the Securities and Exchange Commission, as well as our other filings with the SEC. And finally, during the course of today's call, we referred to certain non-GAAP financial measures. There is a reconciliation schedule showing the GAAP versus non-GAAP results currently available in our press release issued yesterday after market close, which can be found at investors.semrush.com. Now, let me turn the call over to Bill.

Thank you, and good morning. I'm pleased to share that SEMrush reported a strong quarter with revenue of $112.1 million, non-GAAP operating margin of 12.6%, and cash flow from operations of $21.9 million. Demand across our portfolio once again delivered double digit revenue growth. And we saw one of our strongest organic net new annual recurring revenue quarters in years. In addition to the growth we continue to see across our industry leading SEO portfolio, customers are experiencing tremendous value from our new products. We've now introduced three new products for our enterprise customers in the last 15 months. and growth in that segment accelerated in Q3 to 33% year over year. Our AI search products, including our AI toolkit and AI optimization products that were launched this year, added $10 million in ARR in the quarter, more than doubling from Q2 to Q3. These products are not only attracting new customers to SEMrush, but we're also seeing unprecedented growth from our existing customers, where our average ARR per customer has increased 17% year over year. Before going deeper into the results of the quarter, I'd like to step back and discuss the dynamic environment of online visibility and what we're hearing from our customers and how SEMrush is positioned to capture this market opportunity. Over the last decade, the digital landscape has become more crowded, fragmented, and competitive. During this period of change, websites and blogs persisted as essential elements, not just as branded destinations for consumers and customers, but as critical content repositories that support a brand's narrative and provide an important underpinning of its digital presence. On top of these foundations, new content channels emerged as social media properties like Instagram and TikTok began to look more like traditional media, competing for eyeballs and selling advertising. The one constant during this period has been the role of search engines in driving traffic, clicks, and transactions. SEMrush emerged as the category leader by helping companies stand out in this crowded digital landscape, giving marketing teams a single integrated platform to understand their market, track competitors, and optimize performance across websites, blogs, social media, and other channels. As we exit 2025, we believe we are at another inflection point. For the first time in a generation, we have seen important changes to the search landscape and how people engage online. The headline is that more people rely on search than ever before, but the ways consumers use it and what they expect from it are changing rapidly. Google remains the dominant front door to the Internet, with over 5 trillion searches a year, representing more than 90% of all daily searches, and continuing to grow. In addition, people are also using LLMs, often for a different type of use case altogether, such as planning a trip, doing product comparisons, or other zero-click activities. This means that we are living in a moment of expansion in both the volume and the use cases of search. This in turn creates a significant opportunity for SEMrush. While AI introduces new ways to answer questions, large language models still need source material, and they start with the same indexes that power the traditional blue links world of classic search. These models don't just read your company's website and content, They also weigh what others say about your brand in order to assess credibility. That creates new challenges and opportunities for our customers. Companies must now track and influence what appears on review sites like Yelp, on user-generated platforms such as Reddit, and in videos on YouTube. And this isn't only our point of view. Our users and customers have validated it. We recently brought together more than 1,300 marketers, influencers, and industry analysts at our spotlight conference in Amsterdam. And the energy was palpable. Practitioners and experts alike realize that they are at the beginning of a new frontier and suddenly see themselves at the center of attention as CMOs, CEOs, and even board members talk about their brand visibility or lack thereof in AI generated answers. While there's still uncertainty about the future of this emerging space, over the course of a few days, it became clear that this group agrees on two things. First, that building a strong presence in LLMs begins with SEO. And second, that while a well thought out and executed SEO strategy is absolutely essential, it's no longer sufficient without adding a strategy to increase discoverability in LLMs. AI has raised the bar for discoverability, but it builds on the same fundamentals that already separate leaders from laggards. The winning path is not to abandon SEO, but to combine proven SEO with systematic optimization for AI engines so brands are found, cited, and chosen, whether in a search engine results page or in an AI generated answer. At our core, SEMrush is a data company with a software interface built around it. We have one of the richest and largest data sets in the world, a combination of proprietary and industry data that includes 27 billion keywords, 43 trillion backlinks, and over 800 million domains. To this data set, we apply our proprietary algorithms to provide unmatched insights to our customers. Over the last several quarters, we've been busy augmenting our data set with LLM data, and today we've assembled one of the largest prompt databases in the world. As the world's largest platform for digital visibility and with the largest data set of both traditional and LLM search data, SEMrush is uniquely positioned to help our customers generate results. We have a clear opportunity with proven leadership and the capabilities and ambition to lead marketers through this new era. As we saw during Q3, customers are flocking to our products to help them navigate this exciting evolution. One of the top priorities I noted earlier this year was doubling down on AI because we believe we are approaching a time when every marketing team will need to add AI search capabilities on top of their SEO foundation. We saw this play out in the most recent quarter as the traction in our AI products accelerated. Today, more than 10% of SEMrush customers are already using at least one AI product. And we see a path for adoption across the majority of our customer base, representing a significant expansion opportunity. Our AI toolkit launched in March, 2025, and enterprise AI optimization launched in June of this year, both are among our fastest growing products in company history, enabling our AI portfolio ARR to more than double from Q2 to Q3. Together, we expect our AI products will approach 30 million in ARR as we exit the year. For existing customers, these products are additive rather than a replacement for their SEO tools. And it's one of the primary reasons we're seeing double digit increases in average ARR across all segments of our customer base. We expect continued AI momentum in the fourth quarter with further acceleration in 2026 from SEMrush One, our newest product that we launched just a week ago. SEMrush One offers marketers a way to win in every search. whether in a search engine like Google or on a platform like ChatGPT, Gemini, or Perplexity, all in a single tool. Having launched AI optimization for enterprises earlier this year, SEMrush One now makes AI visibility accessible to marketing teams at companies of all sizes. Instead of buying multiple products or switching between different solutions, marketers can have it all in one simple to use product with unified workflows. The new launch strengthens our position with an extensive portfolio for all customer segments, and we believe SEMrush One will emerge as a new benchmark for the industry. Finally, I'd like to close by highlighting our progress in the quarter from our enterprise segment. Focusing on this segment was another priority we highlighted earlier this year, and our investments in both the enterprise product portfolio and go-to-market strategy continue to drive strong growth. Our enterprise SEO product, which was introduced just last year is the largest driver of revenue growth as we successfully move up market and take share away from legacy incumbents in enterprise search. Our average revenue per user in this segment is now above $10,000. And the number of customers paying over $50,000 per year increased by 72% year over year. In Q3, we also began introducing our new enterprise site intelligence product, which along with AI optimization is our second new product for the enterprise segment we've launched in the last six months. We've been very pleased with the adoption of these new products and now see a path to $100,000 plus average ARR for customers that adopt our enterprise platform up from the $60,000 target we mentioned at our analyst day just a year ago. In summary, the search landscape is shape-shifting before our eyes, and we're giving marketers the power to have a full picture of their visibility, act quickly, and improve their position to win. AI search isn't replacing the SEO opportunity, it's compounding it. We've helped define the SEO playbook, and as our Q3 results highlight, we're doing it again for AI Search. We believe our targeted shift towards enterprise customers and our expanding AI product portfolio will position us well for long-term growth. Our pace of innovation and new product development, along with our comprehensive and expanding data set, will allow us to take advantage of the massive market opportunity in front of us. With that, I'll turn the call over to Brian to walk you through the financial results of the quarter and discuss guidance.