BELLEVUE, Wash.

Smartsheet Inc. (NYSE: SMAR) reported better-than-expected second-quarter results and raised its full-year guidance, thanks to strong enterprise growth and improved profitability.

Shares of Smartsheet remained mostly unchanged in after-hours trading after a 4.3% rise on Thursday, following a report from Reuters indicating interest from private equity firms.

The enterprise work management platform achieved adjusted earnings per share of $0.44, exceeding analyst estimates of $0.29. Revenue for the quarter reached $276.4 million, reflecting a 17% year-over-year increase and slightly surpassing the consensus estimate of $274.29 million.

CEO Mark Mader emphasized the company’s enterprise momentum, noting, “Our customers are scaling their work on Smartsheet, with over 70 customers expanding their Smartsheet annualized recurring revenue by more than $100,000 this quarter.”

Smartsheet’s annualized recurring revenue (ARR) grew 17% year-over-year to $1.093 billion, with an average ARR per domain-based customer increasing 16% YoY to $10,291. The company also reported a dollar-based net retention rate of 113%.

For Q3, Smartsheet anticipates revenue between $282 million and $285 million, indicating year-over-year growth of 15% to 16%. The company has raised its full-year revenue outlook to between $1.116 billion and $1.121 billion, up from previous guidance.

The improved profitability was highlighted by a record free cash flow of $57.2 million, or 21% of total revenue. At the end of the quarter, Smartsheet had $706.6 million in cash, cash equivalents, and short-term investments.

(This article does not provide investment advice or recommendations. All information is based on the company’s earnings report and guidance.)

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