- Revenue Growth Q3 revenue reached $201 million, a 9% YoY increase, surpassing guidance.
- AI Product Momentum AI Studio bookings grew sequentially, with wins at a global glassware manufacturer and European trade show operator.
- Retention & Expansion Core customer dollar-based net retention improved to 97%, with 10% YoY growth in core customer revenue.
- Margin Expansion Non-GAAP operating income of $16.3 million (8% margin) and $13.4 million free cash flow highlight disciplined profitability.
Customer Expansion and AI-Driven Growth
The company expanded with key customers, including a multinational entertainment company, two Fortune 100 healthcare service providers, and large tech sector customers. Asana's AI platform, including AI Studio and newly announced AI teammates, is designed to provide context, checkpoints, and controls. AI Studio delivered solid growth in sequential bookings, with notable wins with a global glassware manufacturer and a European trade show operator. The company's AI teammates are collaborative agents that help deliver real business outcomes, remembering, taking action, and adapting with full context on projects, goals, and team operations.
Operational Priorities and Future Guidance
Operational priorities remain focused on vertical depth, improving go-to-market execution, and disciplined, profitable growth. The company delivered strong retention amongst monthly self-service customers and significant improvement in non-GAAP operating margin and adjusted free cash flow. Asana expects Q4 revenues of $204-206 million and non-GAAP operating income of $14-16 million. For the full year, revenue guidance is updated to $789-791 million, representing 9% year-over-year growth.
Valuation and Growth Prospects
With a P/S Ratio of 4.41, the market is pricing in a certain level of revenue growth. Analysts estimate next year's revenue growth at 9.0%. The company's focus on AI-driven productivity tools and its position as an orchestration layer coordinating workflows across the enterprise could drive future growth. Asana's goal is to reaccelerate revenue growth and expand operating cash flow margins, driven by AI Studio and AI teammates. The expected margin expansion to 20% or more is driven by a 90% gross margin and operating leverage.