Rapid7’s first quarter results for 2025 were met with a negative market reaction, as softness in key product areas and a cautious customer environment weighed on investor sentiment. CEO Corey Thomas noted that while Detection and Response remained a core growth driver, the Risk and Exposure Management segment faced continued pressure, particularly among mid-market enterprise customers. Thomas attributed these challenges to extended deal cycles, tighter budgets, and customers reprioritizing spending, especially in sectors like healthcare and education. He remarked, “the environment is more dynamic and fluid than when we initially provided guidance,” underscoring the uncertainty surrounding purchasing behavior in the company’s core market segments.

Is now the time to buy RPD? Find out in our full research report (it’s free).

While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.

Our Top 5 Analyst Questions Rapid7’s Q1 Earnings Call

• Saket Kalia (Barclays) asked why the Exposure Management upgrade cycle is taking longer; CEO Corey Thomas cited mid-market customer budget constraints as the main factor slowing migrations.
• Jonathan Ho (William Blair) inquired about what could reaccelerate ARR growth; Thomas pointed to continued Detection and Response momentum and a successful push to upgrade the installed base as key upside drivers, but stressed the uncertainty around timing.
• Aaron Samuels (Susquehanna) questioned which customer segments are most resilient; Thomas highlighted large enterprises and regulated industries, while noting ongoing pressures in healthcare, education, and state/local government.
• Patrick Colville (Scotiabank) asked about new competitive entrants in vulnerability management; Thomas described the traditional market as competitive but low-growth, emphasizing Rapid7’s differentiated, integrated approach to risk visibility and remediation.
• Joe Gallo (Jefferies) probed the company’s framework for balancing profit and growth; Thomas said investments are targeted at profitable growth areas, especially Detection and Response, and Adams added that selling into the existing customer base offers cost leverage.

Catalysts in Upcoming Quarters

In the coming quarters, our analysts will be monitoring (1) the pace and success of customer migrations to the Exposure Management platform, (2) ongoing growth and margin performance in the Detection and Response business, especially in international markets, and (3) the impact of operational improvements such as the India operations center on cost structure. We will also pay close attention to any shifts in demand trends within key customer segments and further product innovation rollouts.

Rapid7 currently trades at $23.10, down from $26.72 just before the earnings. At this price, is it a buy or sell? The answer lies in our full research report (it’s free).

The Best Stocks for High-Quality Investors

Donald Trump’s victory in the 2024 U.S. Presidential Election sent major indices to all-time highs, but stocks have retraced as investors debate the health of the economy and the potential impact of tariffs.

While this leaves much uncertainty around 2025, a few companies are poised for long-term gains regardless of the political or macroeconomic climate, like our Top 5 Growth Stocks for this month. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+782% five-year return). Find your next big winner with StockStory today.