Sprout Social (SPT) has wrapped up FY 2025 with fourth quarter revenue of US$120.9 million and a basic EPS loss of US$0.18, while on a trailing twelve month basis revenue sits at US$457.5 million with a basic EPS loss of US$0.74. Over the past six reported quarters, the company has seen revenue move from US$102.6 million in Q3 2024 to US$120.9 million in Q4 2025, alongside quarterly basic EPS losses in a range between roughly US$0.16 and US$0.30. This keeps the focus squarely on how quickly margins can tighten and how clearly the path toward profitability can firm up.

See our full analysis for Sprout Social.

With the latest numbers on the table, the next step is to weigh them against the prevailing narratives around growth, profitability, and risk to see which views hold up and which need a rethink.

Revenue Near US$121 million, But Losses Still Material

• Q4 FY 2025 revenue came in at US$120.9 million, while net income for the quarter was a loss of US$10.7 million and basic EPS was a loss of US$0.18, and on a trailing twelve month basis the company reported US$457.5 million of revenue with a net loss of US$43.3 million and a basic EPS loss of US$0.74.
• Consensus narrative focuses on AI powered products and acquisitions like NewsWhip as long term growth drivers. However, the current trailing twelve month loss of US$43.3 million and a multi year pattern of widening losses mean investors still need to see how that product story translates into more efficient earnings over time.
  • Analysts in the consensus view are assuming revenue can reach US$584.0 million and earnings US$38.6 million by about 2029, which contrasts with the current US$457.5 million of revenue and loss position.
  • That same view assumes margins move from a loss today to a 6.6% margin in three years, a shift that is not yet visible in the recent trailing numbers where losses have grown at about 15% per year over five years.

Losses Narrow on TTM Basis, But Profit Still Out of Reach

• On a trailing basis, net loss has moved from US$67.6 million and basic EPS loss of US$1.20 one year ago to a loss of US$43.3 million and basic EPS loss of US$0.74, with revenue over the same window moving from US$392.4 million to US$457.5 million. This aligns with the roughly 8% annual revenue growth rate cited in the analysis.
• Bulls argue that rapid earnings improvement, with forecasts of about 72.7% annual earnings growth and an expectation of profitability within roughly three years, is the key upside. However, the current trailing twelve month loss of US$43.3 million and five year 15% annual loss expansion keep execution risk firmly on the radar.
  • The bullish narrative points to upmarket expansion and AI driven analytics as reasons margins could eventually look more like the US software industry average, while the latest four quarters still show quarterly losses between about US$9.4 million and US$12.0 million.
  • Even optimistic scenarios in the bullish cohort talk about margins moving from roughly a 12.7% loss to a 12.7% positive margin over several years. This represents a sizeable shift compared with the current loss profile you see in the FY 2025 and trailing data.

Bulls suggest the recent improvement in trailing losses could be the early sign of the earnings ramp they expect, and lay out how that might play out in more detail in their full case 🐂 Sprout Social Bull Case

P/S Around 0.9x Versus Peers Near 2.7x

• The stock trades on a P/S of about 0.9x using the trailing twelve month revenue of US$457.5 million and the current share price of US$6.80, compared with a peer average P/S of roughly 2.7x and about 3.7x for the wider US software industry. The analysis also cites a DCF fair value of US$33.95.
• Bears highlight that losses have grown about 15% per year over the last five years and that the company is still unprofitable on a trailing basis. They argue that even with a low P/S multiple there is meaningful risk if revenue growth or margin improvement falls short of expectations.
  • Bearish scenarios in the narrative still assume revenue growth around 11.9% a year and earnings reaching about US$79.0 million by 2028, which is a large swing from today’s US$43.3 million trailing loss and shows how much needs to go right for those valuation cases to work.
  • The gap between the current share price of US$6.80, the analyst target of US$9.89, and the cited DCF fair value of US$33.95 underlines how much bears are focusing on the historical pattern of losses when they question how reliable those longer term earnings paths are.

Skeptics point to the five year pattern of rising losses as a reason to be cautious about the low P/S multiple, and you can see how that concern is framed more fully in the detailed cautious case 🐻 Sprout Social Bear Case

Next Steps

To see how these results tie into long-term growth, risks, and valuation, check out the full range of community narratives for Sprout Social on Simply Wall St. Add the company to your watchlist or portfolio so you'll be alerted when the story evolves.

With both risks and rewards in play, sentiment is clearly divided. Move quickly, review the underlying numbers yourself, and weigh the 3 key rewards and 1 important warning sign

Explore Alternatives

Sprout Social is still posting material losses, has a history of expanding losses, and relies on optimistic margin improvement assumptions that are not yet reflected in current results.

If you are uneasy about that earnings track record and would rather focus on companies where pricing looks more compelling relative to fundamentals, check out 51 high quality undervalued stocks.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.