S&P upgrades Tenable on strong growth and margin expansion

Investing.com -- S&P Global Ratings has upgraded Tenable following consistent revenue growth and platform momentum that have improved the company’s financial performance.

Tenable has demonstrated revenue growth and operating margin expansion over the past two years, consistently outperforming guided metrics. For the year-to-date period ended September 2025, the company reported revenue of approximately $739 million, representing about an 11% year-over-year increase. S&P Global Ratings believes Tenable will finish the year with approximately $990 million in revenue, slightly above 10% growth.

This positive trend is attributed to the successful adoption of Tenable One, the company’s exposure management platform, which now accounts for 40% of all new business, a meaningful increase compared to the previous year. The transition toward this integrated platform has enabled Tenable to secure larger, more strategic deals, consolidating multiple security categories and providing clients with broader insights into their attack surface.

With over 18,000 existing enterprise customers, less than 20% are currently using the platform offering, highlighting significant future potential for Tenable to upsell and cross-sell to nonplatform customers.

The top-line expansion has been accompanied by continued improvements in profitability. S&P Global Ratings-adjusted EBITDA margins have steadily improved, rising from about 11% in 2022 to approximately 15% in 2023 and 21% in 2024, representing a 1,000 basis point margin expansion over two years.

S&P Global Ratings forecasts Tenable’s adjusted EBITDA margin for 2025 will be about 23%, representing an expansion of another 200 basis points from 2024. The company has improved operating efficiency and go-to-market leverage due to its broader product suite and continued growth in scale.

Tenable is well positioned to benefit from growing momentum in operational technology (OT) and AI security. The company acquired Vulcan Cyber in February to expand capabilities to incorporate third-party data from customers’ existing product stacks. Tenable also acquired Apex Security, enhancing its capability to manage risks introduced by generative AI.

As of September 30, 2025, Tenable had cash and short-term investments of approximately $380 million. Year-to-date September 2025 unlevered free cash flow reached about $190 million, up from approximately $150 million for the same period last year, putting the company on track to achieve its annual unlevered free cash flow guidance of $265-$275 million.

S&P Global Ratings expects Tenable’s leverage will be about 1.7x by the end of 2026, absent any substantial acquisitions or shareholder returns.

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