Analysts lowered HubSpot's ratings after its quarterly update, as the software company projected a year-over-year decline in net-new annual recurring revenue (ARR) for fiscal 2026.
HubSpot's third-quarter revenue increased 17% from a year earlier when measured at constant currency. For the fourth quarter, it forecast revenue of $945 million to $947 million, which would represent 12% growth.
The quarter brought a sharper AI-related drag on demand, CEO Yamini Rangan said, following a milder effect in Q2. She said buyers were taking longer to decide, scrutinizing budgets and pricing, and seeking evidence that HubSpot's products justified their cost. Rangan said the company was also dealing with slower deal closures and subdued inbound interest.
Needham identified AI startups as a growing risk to HubSpot's smaller-customer business. The firm sees room for an up-market recovery in 2027 but says consensus estimates for that year should come down.
On Oct. 12, Barclays shifted its rating on HubSpot to Equal-Weight, pointing to a longer wait for AI benefits to emerge at enterprise software companies.
