What AvePoint (AVPT) Said on Its Q3 Earnings Call

Key Points

• AvePoint generated a record $30 million in net new ARR in Q3, up 34% year over year, while revenue rose 19% to $131.1 million. The company raised its full-year ARR outlook to $524.8 million–$528.8 million.
• Adoption of its AI governance product AgentPulse accelerated: customer use grew more than 50% quarter over quarter and the number of managed agents more than doubled. Management said standalone sales are building, though a more material revenue contribution is expected next year.
• Retention and cash flow improved, with gross retention reaching 90%, adjusted net retention at 111%, and nine-month operating cash flow up 29% to $71.6 million. AvePoint reiterated its goal of reaching $1 billion in ARR by the end of 2029.

AvePoint NASDAQ: AVPT reported record net new annual recurring revenue in the third quarter of 2026 and raised its full-year ARR outlook, as demand grew for its data governance and artificial intelligence management products.

The company added $30 million in net new ARR, up 34% from a year earlier, and ended the quarter with $495.1 million in total ARR. That was an increase of 27% on a reported basis and 25% after adjusting for foreign exchange, the second consecutive quarter of accelerating currency-adjusted growth.

Third-quarter revenue rose 19% to $131.1 million, exceeding the high end of management’s guidance. Software-as-a-service revenue increased 26% to $105.5 million, accounting for 80% of the total.

AgentPulse adoption grows

CEO TJ Jiang said the number of customers using AvePoint’s AgentPulse product grew more than 50% from the second quarter to the third, while the number of agents managed through the product more than doubled. AgentPulse provides discovery, governance and lifecycle controls for AI agents across multiple platforms, according to Jiang.

Most of the uptake came through AvePoint’s Control bundles, which include AgentPulse. The company began offering AgentPulse as a standalone product in July. Jiang said the pipeline for that offering was strong, but he expects its more material closing and revenue impact to come next year.

Jiang said many organizations are still using agents for relatively basic tasks, while those deploying them in critical workflows remain in the “top 1%.” AvePoint licenses AgentPulse based on employee counts rather than the number of agents managed, CFO Jim Caci said.

Among the customer examples Jiang cited was a U.S. natural gas infrastructure company that found approximately 3,000 agents had been created in its environment without visibility into their ownership or data access. The existing customer upgraded to AvePoint’s Control Complete package in the third quarter for approximately 7,000 users, he said.

Jiang also highlighted a new customer among Asia’s largest e-commerce companies that selected AvePoint’s Control Plus bundle to secure Google Workspace and Microsoft 365 for approximately 40,000 users. He said the customer replaced an incumbent data security vendor.

AvePoint recently announced its Trust Platform, which extends its governance offering to AI models and tools as well as data and agents. Jiang said the company’s approach differs from traditional cybersecurity vendors because it focuses on data access, changes made by agents and recovery when damage occurs.

Retention and cash flow improve

AvePoint’s currency-adjusted gross retention rate reached 90%, a target management had pursued for several years. Its adjusted net retention rate improved to 111%. Both measures increased from the second quarter.

Caci said the company achieved the gross retention target despite a roughly two-percentage-point headwind from its migration product, which has naturally lower retention rates. He said further improvement of a couple of percentage points could be possible over the next few years.

The company ended the quarter with 976 customers generating more than $100,000 in ARR, up 28% from a year earlier. Net additions to that group totaled 65, the highest AvePoint has recorded. ARR from its managed service provider practice grew 40%, while channel partners accounted for 72% of incremental ARR in the quarter.

Non-GAAP operating income was $22 million, representing a 16.8% margin and reaching the high end of guidance. GAAP operating margin was 8.7%, up more than 130 basis points year over year, even as the company increased spending across the business.

Operating cash flow exceeded $31 million in the third quarter. For the first nine months of 2026, operating cash flow rose 29% to $71.6 million, while free cash flow also increased 29% to $67.7 million.

AvePoint spent approximately $31 million to repurchase 2.3 million shares during the quarter. Year to date, it spent approximately $142 million on 12.6 million shares, with about $89 million remaining under its repurchase program. The company also entered a new $100 million revolving credit facility with JPMorgan, replacing a $30 million facility.

Full-year outlook raised

AvePoint raised the midpoint of its full-year ARR forecast by $1 million and now expects $524.8 million to $528.8 million, representing 26% growth at the midpoint on both a reported and currency-adjusted basis.

Management forecast full-year revenue of $511.3 million to $513.3 million and non-GAAP operating income of $87.5 million to $88.5 million. The updated revenue outlook includes the company’s $1.9 million third-quarter beat relative to guidance.

For the fourth quarter, AvePoint expects revenue of $138.4 million to $140.4 million and non-GAAP operating income of $24.7 million to $25.7 million. Caci said the projected operating margin would rise from the third quarter but remain below the prior-year level as the company continues investing in its AI Trust capabilities.

Management reiterated its target of reaching $1 billion in ARR by the end of 2029. Caci also said the company remained committed to its previously projected 2029 operating-margin level, though he declined to provide a spending outlook for 2027.

About AvePoint (NASDAQ:AVPT)

AvePoint, Inc NASDAQ: AVPT is a data management and governance software company that helps organizations protect, manage and modernize information across cloud, hybrid and on-premises environments. Its solutions are designed primarily for collaboration and productivity platforms, including Microsoft 365, SharePoint, Dynamics 365 and Salesforce.

The company's product portfolio includes cloud backup and recovery, data migration, governance, security, compliance and administration tools.

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