Rapid7 is an exciting organization and we have a reputation for being innovative. In a survey, our employees described Rapid7 as being: collaborative, edgy, hard-working, zany, fast, urgent, cool, punk, life-changing, energetic, driven, teamwork, and feisty… and some other wonderful words and phrases! We’re looking forward to see what new adjectives you’ll come up with as you influence the culture here.

Right now we want you to read the offer letter, sign and accept it, and get this back to us ASAP so we can tell people the good news! Congratulations on choosing Rapid7 for the best part of your career.

We are pleased to confirm our offer to have you join Rapid7 LLC as Chief Financial Officer, reporting to Corey Thomas (our Chief Executive Officer), with a start date of December 1, 2025. In your capacity as Chief Financial Officer, you will perform the duties and responsibilities that are commensurate with your position and such other duties as may reasonably be assigned to you from time to time by the Chief Executive Officer or our Board of Directors. You agree to devote your full business time, attention and best efforts to the performance of your duties and to the furtherance of Rapid7’s interests. Notwithstanding the foregoing, nothing in this offer letter shall preclude you from devoting responsible periods of time to charitable and community activities and managing personal investments and assets; provided that none of these activities interferes with the performance of your duties hereunder or would otherwise violate any restrictive covenant agreement between you and Rapid7.

Your normal place of work will be the Rapid7 offices located in Boston, Massachusetts.

Your annual salary will be $450,000, payable in accordance with Rapid7’s regular payroll procedures (as may be in effect from time to time), which is currently bi-weekly, and less any applicable withholdings or deductions. Annual salary will be reviewed on an annual basis for increase (but not decrease).

Subject to you commencing your employment with us, you will also receive a cash sign-on bonus of $250,000, payable within 45 days after your start date, less applicable withholdings or deductions (the “Sign-On Bonus”). Should you resign without Good Reason (as defined below) from Rapid7, or are terminated by Rapid7 for Cause, as defined in the Rapid7, Inc. 2015 Equity Incentive Plan, as amended (the “Equity Plan”), at any time during your first year of employment, you will be required to repay a pro-rata portion of the amount of the Sign-On Bonus that was paid to you within 45 days of your resignation or termination of employment, as applicable. If you do not repay the net amount of your Sign-On Bonus within 45 days of your separation date, you agree to have such amount be offset from your salary or other monies owed to you by Rapid7, including, but not limited to, wages, bonus and severance to the extent permitted by applicable law. For the avoidance of doubt, no repayment shall be required in the event that your employment is terminated by the Company without Cause, by you with Good Reason, or due to your death or Disability (as defined in the Equity Plan).

In addition, beginning in 2026, you will be eligible for an annual bonus opportunity expressed as 75% of your annual salary (the “Annual Bonus”).

Your Annual Bonus will be measured based on objectives mutually agreed between you and the Compensation Committee from time to time, and subject to the Rapid7, Inc. Executive Incentive Bonus Plan, as may be amended from time to time. As a condition precedent to earning and receiving your Annual Bonus, you must remain an active employee with Rapid7 through the date the Annual Bonus is paid to you. If your employment has been terminated for any reason before such date, then you will not be entitled to any unpaid bonus even where such bonus has been communicated to you or otherwise determined, except as otherwise set forth in the Severance Agreement (as defined below). Notwithstanding the foregoing, your bonus opportunity for calendar year 2026 shall be not less than 75% of your annual salary.

* In connection with the commencement of your employment with Rapid7 and subject to approval by the Compensation Committee, not later than 30 days following the Start Date, you will receive a “New Hire” restricted stock unit award with a grant date value of $7,500,000, with the underlying number of shares of common stock for such award determined using the 30-trading day average closing price through and including the grant date, pursuant to the terms and conditions of the Equity Plan (or any successor equity incentive plan) and the applicable award agreement thereunder. Such award shall vest over a three-year period with 1/3 vesting on December 15, 2026, with quarterly vesting thereafter, subject to your continued service on such vesting date.

* In connection with the commencement of your employment with Rapid7 and subject to approval by the Compensation Committee, you will also be eligible to receive, not later than March 31, 2026, an “Executive Grant” performance-based restricted stock unit award with an approximate value of $2,500,000, with the terms of such award, including, without limitation, the underlying number of shares of common stock subject to such award, the performance metrics and performance period, the vesting schedule etc., to be determined in the sole discretion of the Compensation Committee.

* In connection with the commencement of your employment with Rapid7 and subject to approval by the Compensation Committee, you will also receive, in the first quarter of calendar 2026, a “Supplemental” equity award with an approximate value of $5,000,000, under a new program to be established by Rapid7, with the terms of such award to be determined in the sole discretion of the Compensation Committee. If such program is not established, and such award is not granted, prior to March 31, 2026, then you will receive, instead of the Supplemental equity award, an additional performance-based restricted stock unit award with an approximate value of $2,000,000, with the terms of such award, including, without limitation, the underlying number of shares of common stock subject to such award, the performance metrics and performance period, the vesting schedule etc., to be determined in the sole discretion of the Compensation Committee.

Rapid7 will enter into its form of Severance and Equity Award Vesting Acceleration Letter Agreement with you following the date hereof (the “Severance Agreement”).

Rapid7 will enter into its form of Indemnity Agreement with you following the date hereof.

During your employment with Rapid7, you will be eligible to participate in the employee benefit plans and programs applicable generally to other similarly situated executives of Rapid7, in accordance with the terms of such plans and programs, as are in effect from time to time.

Any payments made or benefits provided to you under this offer letter or otherwise paid to you in the form of compensation will be net of all withholdings or deductions required by applicable law.

You will be subject to and required to abide by all of Rapid7’s personnel policies applicable to you to the extent applicable to similarly situated employees of Rapid7 or as otherwise required by applicable law or applicable stock exchange listing rules, including, without limitation, the Rapid7, Inc. Compensation Recoupment Policy, the Rapid7, Inc. Amended and Restated Insider Trading and Trading Window Policy, stock ownership guidelines and any other code of conduct or personnel policy adopted by Rapid7 (as in effect from time to time).

It is intended that the provisions of this offer letter comply with or are exempt from Section 409A of the Internal Revenue Code of 1986, as amended (the “Code”) (together with the regulations and other interpretive guidance issued thereunder, “Section 409A”), and all provisions of this offer letter will be construed and interpreted in a manner consistent with such intent. In no event shall Rapid7 or any of its affiliates be liable for any additional tax, interest or penalty that may be imposed on you by Section 409A.

Rapid7 is an “at-will” employer. That means that both employees and Rapid7 have the right to terminate employment at any time, with or without advance notice, and with or without cause. No one other than an officer of Rapid7 (or any other duly authorized person) has the authority to alter this arrangement, to enter into an agreement for employment for a specified period of time, or to make any agreement contrary to this policy, and any such agreement must be in writing and must be signed by an officer of Rapid7 and by the affected employee. For the avoidance of doubt, alterations to this offer letter or the Severance Agreement may not be made without your consent.

The terms of this offer letter, and any action arising hereunder, shall be governed by and construed in accordance with the domestic laws of the Commonwealth of Massachusetts without giving effect to any choice of law or conflict of law provision or rule (whether of the Commonwealth of Massachusetts or other jurisdiction) that would cause the application of the laws of any jurisdiction other than the Commonwealth of Massachusetts and I hereby expressly consent to the personal jurisdiction and venue of the state and federal courts located in the Commonwealth of Massachusetts for any lawsuit filed there against me by Rapid7 arising from or related to this Agreement. Your offer is contingent upon (1) successful completion of a routine background investigation and references; (2) signing of the Rapid7 Confidentiality, Assignment, and Non-Solicitation Agreement; (3) signing of the Rapid7 Media Release Form; (4) signing of the Rapid7 Employee Handbook, which acknowledges all Rapid7 policies; and (5) your completion and Rapid7’s review of your responses to its 2025 Executive Officers’ Questionnaire. You also must establish your identity and authorization to work as required by the Immigration Reform and Control Act of 1986 (IRCA). Under separate cover you will receive a copy of the Employment Verification Form (I-9), with instructions required by IRCA;.

This letter sets forth our entire agreement and understanding regarding the terms of your employment with Rapid7 and supersedes any prior representations or agreements, whether written or oral. Please let us know of your decision to join Rapid7 by signing a copy of this offer letter and returning it to us no later than 5:00 p.m. Eastern Time two (2) business days after the date of this offer letter.

We look forward to you accepting our offer and becoming part of the Rapid7 team.

Accepted and Agreed:

Signature: /s/ Rafe Brown Date: November 1, 2025

Rapid7: /s/ Katie Kulikoski    

Katie Kulikoski, Chief People Officer

November 1, 2025

Re: Severance and Equity Award Vesting Acceleration

Dear Rafeal Brown:

We are pleased to inform you that the Compensation Committee of the Board of Directors of Rapid7, Inc. (the “Company”) has approved severance and vesting acceleration terms for you, which are described in this letter agreement (the “Agreement”).

The vesting acceleration described in Section 2, below shall apply to each of your outstanding compensatory equity awards granted to you prior to the date hereof under the Company’s 2011 Stock Option and Grant Plan, as amended (the “2011 Plan”) or the Company’s 2015 Equity Incentive Plan, as amended (the “2015 Plan” and together with the 2011 Plan, the “Plans”) that are subject to a time-based vesting schedule to the extent such awards were granted to you while you were an Eligible Employee (as defined below) (the “Equity Awards”). Capitalized terms used in this Agreement and not defined herein shall have the meanings set forth in the applicable Plan. This Agreement amends the terms of the Equity Awards that have previously been granted to you and are currently outstanding. Further, unless otherwise expressly provided by the Company at the time of grant, any future compensatory equity awards covering Company common stock, including awards of stock options, restricted stock, restricted stock units or other types of equity awards, as applicable, that the Company may grant to you in the future and that are subject to a time-based vesting schedule shall also be deemed to be “Equity Awards” for purposes of this Agreement to the extent such award(s) are granted to you while you are an Eligible Employee. For purposes of clarity, any compensatory equity awards that are subject to performance-based vesting shall not be deemed to be “Equity Awards” hereunder and shall only vest, if at all, in accordance with the terms of the applicable Plan and award agreement.

1.    Severance. If you experience a Qualifying Termination (as defined below) while you are an Eligible Employee (and disregarding for this purpose, any reduction in your job duties, authorities or responsibilities that results in a termination of your employment for Good Reason), then, provided you timely comply with the conditions described in Section 3:

(a) the Company will pay you an amount equal to your then current base salary (disregarding for this purpose, any reduction of your base salary that results in a termination of your employment for Good Reason) for the applicable Severance Period, payable in substantially equal installments in accordance with the Company’s regular payroll practice over such period, commencing within 60 days after the date of your Qualifying Termination; provided, however, that if the 60-day period begins in one calendar year and ends in a second calendar year, such payments shall begin to be paid in the second calendar year and the initial payment shall include a catch-up payment to cover amounts retroactive to the day immediately following the date of your Qualifying Termination;

(b) if you timely elect to continue coverage under the Consolidated Omnibus Budget Reconciliation Act of 1985, as amended (“COBRA”), the Company shall pay your COBRA premiums, and any applicable Company COBRA premiums, necessary to continue your then-current coverage until the earliest of (A) the end of the applicable Severance Period, (B) the expiration of your eligibility for the continuation coverage under COBRA and (C) the date you become eligible to enroll in a health insurance plan offered by another employer or entity. You agree to immediately notify the Company in writing of any such enrollment or eligibility for enrollment and the Company’s obligation to pay any COBRA premiums shall immediately cease. Notwithstanding the foregoing, if the Company determines, in its sole discretion, that it cannot provide the foregoing benefit without potentially incurring financial costs or penalties under applicable law (including, without limitation, Section 2716 of the Public Health Service Act), the Company shall in lieu thereof provide you with a taxable monthly amount (which amount shall be based on the premium for the first month of COBRA coverage hereunder), which payments shall be made regardless of whether you elect COBRA continuation coverage.

If the Company elects to make such payments in lieu of paying such COBRA premiums, the payments will end on the earlier of (x) the date on which you voluntarily enroll in a health insurance plan offered by another employer or (y) the end of the Severance Period; and (c) if such Qualifying Termination occurs during the Change in Control Period, then the Company shall pay you a lump-sum amount equal to 100% of your target annual cash performance bonus for the year of termination (or, if greater, your target annual cash performance bonus as in effect immediately prior to the Change of Control), payable on the first regular payroll date of the Company that is 60 days following the date of such termination (or, if later, the date of such Change in Control);

2.     Equity Award Vesting Acceleration.

(a) If, in connection with a Change in Control, (x) an Equity Award is assumed or continued by the successor or acquiror entity in such Change in Control or such Equity Award is substituted for a similar award of the successor or acquiror entity, and (y) you experience a Qualifying Termination within the Change in Control Period, then, provided you timely comply with the conditions described in Section 3 below, you will become vested, effective as of the date that is 60 days following the date of such Qualifying Termination (or, if later, the effective date of such Change in Control) with respect to 100% of any then unvested portion of any applicable Equity Award.

(b) If, in connection with a Change in Control, an Equity Award shall terminate and will not be so assumed or continued by the successor or acquiror entity in such Change in Control or substituted for a similar award of the successor or acquiror entity, then, you will become vested, with respect to 100% of any then unvested portion of any applicable Equity Award, effective immediately prior to, but subject to the consummation of such Change in Control.

3.     Conditions to Receipt of Severance and Equity Award Vesting Acceleration. In order to receive the severance and Equity Award vesting acceleration described in Sections 1 and 2(a), above, you must sign a separation agreement containing, among other provisions, a general release of claims in favor of the Company and related persons and entities, confidentiality, return of property and non-disparagement, in a form and manner satisfactory to the Company (the “Separation Agreement and Release”) and the Separation Agreement and Release must become irrevocable, all within 60 days after your Qualifying Termination. In order to effect the provisions of this Section 3, any termination or forfeiture of any unvested Equity Awards eligible for acceleration of vesting pursuant to Section 2(a) above that otherwise would have occurred on or within 60 days after your Qualifying Termination will be delayed until the 60th day after the date of your Qualifying Termination (but, in the case of any stock option, not later than the expiration date of such stock option specified in the applicable option agreement) and will only occur to the extent such equity awards do not vest pursuant to Section 2(a) above and, for purposes of clarity, no additional vesting of any Equity Award shall occur during such 60 day period.

4.     Certain Definitions. For purposes of this Agreement, the following terms shall have the following meanings:

(a) “Cause” will have the meaning ascribed to such term in the 2015 Plan.

(b) “Change in Control Period” means the period commencing three months prior to, and ending 12 months following, a Change in Control.

(c) “Eligible Employee” means an employee of the Company having the title of Senior Vice President or higher.

(d) “Good Reason” shall mean the occurrence any of the following, in each case without your written consent provided that you must (i) give written notice to the Company’s Chief Executive Officer within 30 days after the first occurrence of the first event giving rise to Good Reason setting forth the basis for your resignation (which shall be specified in reasonable detail), (ii) allow the Company at least 30 days from receipt of such written notice to cure such event, and (iii) if such event is not reasonably cured within such period, you must resign from all positions you then hold with the Company and its affiliates, effective not later than 90 days after the expiration of the cure period: (A) a material decrease in your then current base salary, except for across-the-board reductions similarly affecting all or substantially all similarly situated employees of the Company, (B) a material reduction in your job duties, authorities or responsibilities, provided, however, that a change in job position (including a change in title) shall not be deemed a “material reduction” in and of itself unless your new duties are materially reduced from your prior duties, (C) a relocation of your regular place of work to any location that increases your one-way commute by more than 50 miles of your then-current principal place of employment immediately prior to such relocation, or (D) a material breach by the Company of its obligations under this Agreement or other agreement between you and the Company.

Your right to terminate your employment as a result of Good Reason shall not be affected by your incapacity due to physical or mental illness. Subject to the notice requirements above, your continued employment from the date Good Reason first exists and the date upon which you terminate your employment with the Company shall not constitute consent to, or a waiver of rights with respect to, any circumstance constituting Good Reason hereunder. Notwithstanding anything to the contrary in this Agreement, Good Reason shall be deemed to exist in the event that following a Change in Control of the Company you do not remain the Chief Financial Officer of the new or surviving entity or its ultimate parent entity.

(e) “Qualifying Termination” means a termination of your Continuous Service (as defined in the 2015 Plan) either (x) by the Company without Cause or (y) by you with Good Reason. Termination of Continuous Service due to your death or Disability (as defined in the 2015 Plan) will not constitute a Qualifying Termination.

(f) “Severance Period” means 6 months, provided that the Severance Period shall instead be 12 months to the extent that a Qualifying Termination occurs during the Change in Control period.

5.     Section 409A. The payments and benefits under this Agreement are intended to qualify for an exemption from application of Section 409A of the Code (“Section 409A”) or comply with its requirements to the extent necessary to avoid adverse personal tax consequences under Section 409A, and any ambiguities herein shall be interpreted accordingly. To the extent that any payment or benefit described in this Agreement constitutes “non-qualified deferred compensation” under Section 409A, and to the extent that such payment or benefit is payable upon the termination of your employment, then such payments or benefits will be payable only upon your “separation from service.” The determination of whether and when a separation from service has occurred will be made in accordance with the presumptions set forth in Treasury Regulation Section 1.409A-1(h). Anything in this Agreement to the contrary notwithstanding, if at the time of your separation from service, the Company determines that you are a “specified employee” within the meaning of Section 409A(a)(2)(B)(i) of the Code, then to the extent any payment or benefit that you become entitled to under this Agreement on account of your separation from service would be considered deferred compensation subject to the 20 percent additional tax imposed pursuant to Section 409A(a) of the Code as a result of the application of Section 409A(a)(2)(B)(i) of the Code, such payment will not be payable and such benefit will not be provided until the date that is the earlier of (A) six months and one day after your separation from service, (B) your death, or (C) such earlier date as permitted under Section 409A without imposition of adverse taxation. If any such delayed cash payment is otherwise payable on an installment basis, the first payment will include a catch-up payment covering amounts that would otherwise have been paid during the six-month period but for the application of this provision, and the balance of the installments will be payable in accordance with their original schedule. The Company makes no representation or warranty and will have no liability to you or any other person if any provisions of this Agreement are determined to constitute deferred compensation subject to Section 409A but do not satisfy an exemption from, or the conditions of, Section 409A.

6.     Parachute Payments. If any payment or benefit you would receive from the Company or otherwise in connection with a Change in Control or other similar transaction (a “280G Payment”) would (i) constitute a “parachute payment” within the meaning of Section 280G of the Code, and (ii) but for this sentence, be subject to the excise tax imposed by Section 4999 of the Code (the “Excise Tax”), then any such 280G Payment (a “Payment”) shall be equal to the Reduced Amount. The “Reduced Amount” shall be either (x) the largest portion of the Payment that would result in no portion of the Payment (after reduction) being subject to the Excise Tax or (y) the largest portion, up to and including the total, of the Payment, whichever amount (i.e., the amount determined by clause (x) or by clause (y)), after taking into account all applicable federal, state and local employment taxes, income taxes, and the Excise Tax (all computed at the highest applicable marginal rate), results in your receipt, on an after-tax basis, of the greater economic benefit notwithstanding that all or some portion of the Payment may be subject to the Excise Tax. If a reduction in a Payment is required pursuant to the preceding sentence and the Reduced Amount is determined pursuant to clause (x) of the preceding sentence, the reduction shall occur in the manner (the “Reduction Method”) that results in the greatest economic benefit for you. If more than one method of reduction will result in the same economic benefit, the items so reduced will be reduced pro rata (the “Pro Rata Reduction Method”).

Notwithstanding the foregoing, if the Reduction Method or the Pro Rata Reduction Method would result in any portion of the Payment being subject to taxes pursuant to Section 409A of the Code that would not otherwise be subject to taxes pursuant to Section 409A of the Code, then the Reduction Method and/or the Pro Rata Reduction Method, as the case may be, shall be modified so as to avoid the imposition of taxes pursuant to Section 409A of the Code as follows: (A) as a first priority, the modification shall preserve to the greatest extent possible, the greatest economic benefit for you as determined on an after-tax basis; (B) as a second priority, Payments that are contingent on future events (e.g., being terminated without cause), shall be reduced (or eliminated) before Payments that are not contingent on future events; and (C) as a third priority, Payments that are “deferred compensation” within the meaning of Section 409A of the Code shall be reduced (or eliminated) before Payments that are not deferred compensation within the meaning of Section 409A of the Code.

Unless you and the Company agree on an alternative accounting firm, the accounting firm engaged by the Company for general tax compliance purposes as of the day prior to the effective date of the change of control transaction triggering the Payment shall perform the foregoing calculations. If the accounting firm so engaged by the Company is serving as accountant or auditor for the individual, entity or group effecting the change of control transaction, the Company shall appoint a nationally recognized accounting firm to make the determinations required hereunder. The Company shall bear all expenses with respect to the determinations by such accounting firm required to be made hereunder. The Company shall use commercially reasonable efforts to cause the accounting firm engaged to make the determinations hereunder to provide its calculations, together with detailed supporting documentation, to you and the Company within 15 calendar days after the date on which your right to a 280G Payment becomes reasonably likely to occur (if requested at that time by you or the Company) or such other time as requested by you or the Company.

If you receive a Payment for which the Reduced Amount was determined pursuant to clause (x) of the first paragraph of this Section and the Internal Revenue Service determines thereafter that some portion of the Payment is subject to the Excise Tax, you shall promptly return to the Company a sufficient amount of the Payment (after reduction pursuant to clause (x) of the first paragraph of this Section so that no portion of the remaining Payment is subject to the Excise Tax. For the avoidance of doubt, if the Reduced Amount was determined pursuant to clause (y) in the first paragraph of this Section, you shall have no obligation to return any portion of the Payment pursuant to the preceding sentence.

7.    Miscellaneous. This Agreement set forth the entire understanding between you and the Company with respect to the subject matter hereto and supersedes all prior oral and written agreements, promises and/or representations on that subject. This Agreement is not an agreement of employment and shall not confer upon you any right to be retained by or in the employ of the Company and shall not interfere in any way with the right of the Company to terminate your employment or service arrangement at any time or for any reason. This Agreement will be binding upon any surviving entity resulting from a Change in Control of the Company and upon any other person who is a successor by merger, acquisition, consolidation or otherwise to the business formerly carried on by the Company without regard to whether or not such person or entity actively assumes the obligations hereunder. The terms of this Agreement, and any action arising hereunder, shall be governed by and construed in accordance with the domestic laws of the Commonwealth of Massachusetts giving effect to any choice of law or conflict of law provision or rule (whether of the Commonwealth of Massachusetts or other jurisdiction) that would cause the application of the laws of any jurisdiction other than the Commonwealth of Massachusetts and you hereby expressly consent to the personal jurisdiction and venue of the state and federal courts located in the Commonwealth of Massachusetts for any lawsuit filed there against me by Company arising from or related to this Agreement.

* * *

Except as provided herein, all terms and conditions of your Equity Awards and any other written agreement between you and the Company remain in full force and effect and are not amended by this Agreement.

Please countersign below to acknowledge your receipt of this Agreement and your agreement to the terms described herein.

With best regards,

/s/ Katie Kulikoski

Katie Kulikoski

Chief People Officer

Acknowledged and agreed:

/s/ Rafe Brown

Name: Rafe Brown

Date: November 1, 2025

 

•Annualized recurring revenue (“ARR”) of $838 million, an increase of 2% year-over-year

•Total revenue of $218 million, up 2% year-over-year; Product subscriptions revenue of $210 million, up 2% year-over-year

•GAAP operating income of $5.9 million; Non-GAAP operating income of $37 million

•Net cash provided by operating activities of $38 million; Free cash flow of $30 million

Boston, MA – November 4, 2025 – Rapid7, Inc. (Nasdaq: RPD), a leader in threat detection and exposure management, today announced its financial results for the third quarter 2025.

"We ended the third quarter with $838 million in ARR as our AI-driven Command Platform continues to gain market validation," said Corey Thomas, CEO of Rapid7. "With our differentiated approach to expert-guided AI and automation, combined with strategic go-to-market enhancements, we're well-positioned to capitalize on the growing demand for integrated security operations platforms."

The company today announced the appointment of Rafe Brown as Chief Financial Officer (CFO), effective December 1, 2025. Mr. Brown will assume the CFO role from current Rapid7 CFO Tim Adams, who has served as Rapid7's Chief Financial Officer since January 2022, and announced his intent to retire from his position in August 2025. Mr. Brown brings extensive industry and executive leadership experience across multiple public companies, most recently at Mimecast where he served initially as Chief Financial Officer, and then later as President and COO. He brings with him a strong track record of driving operational excellence, scaling growth in SaaS businesses, and building high-performing teams.

“We are thrilled to welcome Rafe to Rapid7’s leadership team,” said Corey Thomas, CEO of Rapid7. “The deep financial and operational expertise he brings to our team will be instrumental in our journey ahead as we look to scale our growth and profitability in the years ahead.”

For additional details on the reconciliation of non-GAAP measures and certain other business metrics to their nearest comparable GAAP measures, please refer to the accompanying financial data tables included in this press release. The prior year period reflects an immaterial correction. Refer to Note 15, Immaterial Correction of an Error, in the notes to our unaudited condensed consolidated financial statements for further information.

•In November, Rapid7 announced an expanded partnership with Microsoft to advance modern detection and response, bringing together Rapid7’s SOC expertise with Microsoft’s security ecosystem to simplify operations, strengthen protection, and unlock new value for joint customers.

•In October, Rapid7 announced new AI-generated risk intelligence as part of the Command Platform, delivered through Remediation Hub. The new capability accelerates remediation by giving security teams a clear, contextual and actionable view of each exposure, helping teams to prioritize remediation and drive measurable risk reduction.

•In October, Rapid7 was recognized in the Gartner® Magic Quadrant™ for Security Information and Event Management (SIEM), marking the seventh consecutive year that Rapid7 has been placed in the report.

•In October, Rapid7 announced its strategic expansion into the UAE, marking a significant investment in the region and reinforcing Rapid7’s long-term commitment to support the nation’s digital transformation and cyber resilience goals.

•In August, Rapid7 was named a leader in the IDC MarketScape for Exposure Management. Rapid7 was recognized in part for its Command Platform, an AI-powered security operations platform that unifies solutions for both exposure management and threat detection and response to deliver deep and broad situational awareness.

•In August, Rapid7 launched Vector Command Advanced, expanding its continuous red teaming and exposure validation service to help organizations meet compliance requirements with internal penetration and segmentation testing on top of validating the effectiveness of internal controls and lateral movement protections.

•In August, Rapid7 released a new Access Brokers Report, a new research analysis leveraging six months of threat intelligence data to uncover new insights into how initial access to compromised businesses is being sold, and the steps defenders can take to disrupt the process.

Rapid7 anticipates ARR, revenue, non-GAAP income from operations, non-GAAP net income per share and free cash flow to be in the following ranges:

The guidance provided above is forward-looking in nature. Actual results may differ materially. See the cautionary note regarding “Forward-Looking Statements” below. Guidance for the fourth quarter 2025 does not include any potential impact of foreign exchange gains or losses. The guidance provided above is based on a number of assumptions, estimates and expectations as of the date of this press release and, while presented with numerical specificity, this guidance is inherently subject to significant business, economic and competitive uncertainties and contingencies, many of which are beyond Rapid7's control and are based upon specific assumptions with respect to future business decisions or economic conditions, some of which may change. Rapid7 undertakes no obligation to update guidance after this date.

Rapid7 will host a conference call today, November 4, 2025, to discuss its results at 4:30 p.m. Eastern Time. The call will be available live via webcast on Rapid7's website at https://investors.rapid7.com. A webcast replay of the conference call will be available at https://investors.rapid7.com.

Rapid7, Inc. (NASDAQ: RPD) is on a mission to create a safer digital world by making cybersecurity simpler and more accessible. We empower security professionals to manage a modern attack surface through our best-in-class technology, leading-edge research, and broad, strategic expertise. Rapid7’s comprehensive security solutions help more than 11,000 global customers unite cloud risk management with threat detection and response to reduce attack surfaces and eliminate threats with speed and precision. For more information, visit our website, check out our blog, or follow us on LinkedIn or X.

To supplement our consolidated financial statements, which are prepared and presented in accordance with generally accepted accounting principles in the United States (“GAAP”), we provide investors with certain non-GAAP financial measures and other metrics, which we believe are helpful to our investors. We use these non-GAAP financial measures and other metrics for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. We also use certain non-GAAP financial measures as performance measures under our executive bonus plan. We believe that these non-GAAP financial measures and other metrics provide useful information about our operating results, enhance the overall understanding of past financial performance and future prospects and allow for greater transparency with respect to metrics used by our management in its financial and operational decision-making.

While our non-GAAP financial measures are an important tool for financial and operational decision-making and for evaluating our own operating results over different periods of time, you should review the reconciliation of our non-GAAP financial measures to the comparable GAAP financial measures included below, and not rely on any single financial measure to evaluate our business.

We disclose the following non-GAAP financial measures: non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income, non-GAAP net income per share, adjusted EBITDA and free cash flow. We also disclose non-GAAP gross margin and non-GAAP operating margin derived from these financial measures.

We define non-GAAP gross profit, non-GAAP income from operations, non-GAAP net income and non-GAAP net income per share as the respective GAAP balances excluding the effect of stock-based compensation expense, amortization of acquired intangible assets, amortization of debt issuance costs and certain other items such as acquisition-related expenses, impairment of long-lived assets, change in the fair value of derivative assets, restructuring expense, induced conversion expense and discrete tax items. Non-GAAP net income per basic and diluted share is calculated as non-GAAP net income divided by the weighted average shares used to compute net income per share, with the number of weighted average shares decreased, when applicable, to reflect the anti-dilutive impact of the capped call transactions entered into in connection with our convertible senior notes.

We believe these non-GAAP financial measures are useful to investors in assessing our operating performance due to the following factors:

Stock-based compensation expense. We exclude stock-based compensation expense because of varying available valuation methodologies, subjective assumptions and the variety of equity instruments that can impact our non-cash expense. We believe that providing non-GAAP financial measures that exclude stock-based compensation expense allows for more meaningful comparisons between our operating results from period to period.

Amortization of acquired intangible assets. We believe that excluding the impact of amortization of acquired intangible assets allows for more meaningful comparisons between operating results from period to period as the intangible assets are valued at the time of acquisition and are amortized over several years after the acquisition.

Amortization of debt issuance costs. The expense for the amortization of debt issuance costs related to our convertible senior notes and our former revolving credit facility is a non-cash item, and we believe the exclusion of this interest expense provides a more useful comparison of our operational performance in different periods.

Induced conversion expense. In conjunction with the third quarter of 2023 partial repurchase of our 2.25% convertible senior notes due 2025, we incurred a non-cash induced conversion expense of $53.9 million. We exclude induced conversion expense because this amount is not indicative of the performance of or trends in our business, and neither is comparable to the prior period nor predictive of future results.

Non-ordinary course litigation-related expenses. We exclude non-ordinary course litigation expense because we do not consider legal costs and settlement fees incurred in litigation and litigation-related matters of non-ordinary course lawsuits and other disputes to be indicative of our core operating performance. We do not adjust for ordinary course legal expenses, including legal costs and settlement fees resulting from maintaining and enforcing our intellectual property portfolio and license agreements.

Acquisition-related expenses. We exclude acquisition-related expenses, including accretion expense associated with contingent consideration, as costs that are unrelated to the current operations and are neither comparable to the prior period nor predictive of future results.

Change in fair value of derivative assets. The expense for the change in fair value of derivative assets related to our 2023 capped calls settlement is a non-cash item and we believe the exclusion of this other income (expense) provides a more useful comparison of our operational performance in different periods.

Impairment of long-lived assets. Impairment of long-lived assets consists of impairment charges allocated to the carrying amount of certain operating right-of-use assets and the associated leasehold improvements when the carrying amounts exceed their respective fair values and we believe the exclusion of the impairment charges provides a more useful comparison of our operational performance in different periods.

Restructuring expense. We exclude non-ordinary course restructuring expenses related to our restructuring plan, that was completed during fiscal year 2024, because we do not believe these charges are indicative of our core operating performance and we believe the exclusion of the restructuring expenses provides a more useful comparison of our performance in different periods.

Discrete tax items. We exclude certain discrete tax items such as income tax expenses or benefits that are not related to ongoing business operations in the current year and adjustments to uncertain tax position reserves as these charges are not indicative of our ongoing operating results, and they are not considered when we are forecasting our future results.

Anti-dilutive impact of capped call transaction. Our capped call transactions are intended to offset potential dilution from the conversion features in our convertible senior notes. Although we cannot reflect the anti-dilutive impact of the capped call transactions under GAAP, we do reflect the anti-dilutive impact of the capped call transactions in non-GAAP net income (loss) per diluted share, when applicable, to provide investors with useful information in evaluating our financial performance on a per share basis.

Adjusted EBITDA. Adjusted EBITDA is a non-GAAP measure that we define as net income (loss) before (1) interest income, (2) interest expense, (3) other (income) expense, net, (4) provision for (benefit from) income taxes, (5) depreciation expense, (6) amortization of intangible assets, (7) stock-based compensation expense, (8) acquisition-related expenses, and (9) restructuring expense. We believe that the use of adjusted EBITDA is useful to investors and other users of our financial statements in evaluating our operating performance because it provides them with an additional tool to compare business performance across companies and across periods.

Free Cash Flow. Free cash flow is a non-GAAP measure that we define as cash provided by operating activities less purchases of property and equipment and capitalization of internal-use software costs. We consider free cash flow to be a liquidity measure that provides useful information to management and investors about the amount of cash generated by the business after necessary capital expenditures.

We include all non-GAAP financial measures in the current year or any comparative year that will be included in the non-GAAP reconciliation during the current fiscal year annual Form 10-K. As such, not all non-GAAP financial measures listed above may be included in the current reporting period non-GAAP reconciliation in the GAAP to Non-GAAP Reconciliation section below.

Our non-GAAP financial measures may not provide information that is directly comparable to that provided by other companies in our industry, as other companies in our industry may calculate non-GAAP financial results differently, particularly related to non-recurring, unusual items. In addition, there are limitations in using non-GAAP financial measures because the non-GAAP financial measures are not prepared in accordance with GAAP, may be different from non-GAAP financial measures used by other companies and exclude expenses that may have a material impact upon our reported financial results. Further, stock-based compensation expense has been and will continue to be for the foreseeable future a significant recurring expense in our business and an important part of the compensation provided to our employees.

ARR. ARR is defined as the annual value of all recurring revenue related to contracts in place at the end of the period. ARR should be viewed independently of revenue and deferred revenue as ARR is an operating metric and is not intended to be combined with or replace these items. ARR is not a forecast of future revenue, which can be impacted by contract start and end dates and renewal rates, and does not include revenue reported as professional services revenue in our consolidated statement of operations.

Number of Customers. We define a customer as any entity that has an active Rapid7 recurring revenue contract as of the specified measurement date, excluding InsightOps and Logentries only customers with a contract value of less than $2,400 per year.

ARR per Customer. We define ARR per customer as ARR divided by the number of customers at the end of the period.

This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements include, but are not limited to, the statements regarding our financial guidance for the fourth quarter and full-year 2025, and the assumptions underlying such guidance. Our use of the words “anticipate,” “believe,” “estimate,” “expect,” “intend,” “may,” “will” and similar expressions are intended to identify forward-looking statements. The events described in our forward-looking statements are subject to a number of risks and uncertainties, assumptions and other factors that could cause actual results and the timing of certain events to differ materially from future results expressed or implied by the forward-looking statements. Risks that could cause or contribute to such differences include, but are not limited to, growing macroeconomic uncertainty, unstable market and economic conditions, fluctuations in our quarterly results, our ability to successfully grow our sales of our cloud-based solutions, including through the shift to a consolidated platform sales approach, effectiveness of our restructuring plan that was completed during fiscal year 2024, failure to meet our publicly announced guidance or other expectations about our business, our ability to sustain our revenue growth rate, the ability of our products and professional services to correctly detect vulnerabilities, renewal of our customer's subscriptions, competition in the markets in which we operate, market growth, our ability to innovate and manage our growth, our sales cycles, our ability to integrate acquired companies, exposure to greater than anticipated tax liabilities, and our ability to operate in compliance with applicable laws as well as other risks and uncertainties that could affect our business and results described in our filings with the Securities and Exchange Commission (the “SEC”), including our most recent Annual Report on Form 10-K filed with the SEC on February 28, 2025, particularly in the section entitled "Item 1.A Risk Factors," and in the subsequent reports that we file with the SEC. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those expressed in any forward-looking statements we may make. Except as required by law, we undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date of such statements. You should, therefore, not rely on these forward-looking statements as representing our views as of any date subsequent to the date of this press release.

Ryan Gardella / Ryan Flanagan

ICR, Inc.

investors@rapid7.com

(617) 865-4277

Alice Randall

Director, Global Corporate Communications

press@rapid7.com

(214) 693-4727

(1) We use the if-converted method to compute diluted earnings per share with respect to our convertible senior notes. There was no add-back of interest expense or additional dilutive shares related to the convertible senior notes where the effect was anti-dilutive. On an if-converted basis, for the three months ended September 30, 2025 the 2029 Notes and 2027 Notes were anti-dilutive and for the nine months ended September 30, 2025 the 2029 Notes, 2027 Notes and 2025 Notes were anti-dilutive.

 

						Three Months Ended September 30,												Nine Months Ended September 30,
						2025						2024						2025						2024
GAAP total gross profit						$	152,976					$	151,497					$	454,883					$	442,603
Add: Stock-based compensation expense(1)						$	2,457					$	3,141					$	7,301					$	9,082
Add: Amortization of acquired intangible assets(2)						$	4,424					$	4,410					$	13,270					$	12,739
Non-GAAP total gross profit						$	159,857					$	159,048					$	475,454					$	464,424
Non-GAAP gross margin						73		%				74		%				74		%				74		%
GAAP gross profit – product subscriptions						$	151,883					$	148,819					$	452,311					$	435,963
Add: Stock-based compensation expense						$	1,931					$	2,685					$	5,716					$	7,785
Add: Amortization of acquired intangible assets						$	4,424					$	4,410					$	13,270					$	12,739
Non-GAAP gross profit – product subscriptions						$	158,238					$	155,914					$	471,297					$	456,487
Non-GAAP gross margin - product subscriptions						75		%				76		%				76		%				76		%
GAAP gross profit – professional services						$	1,093					$	2,678					$	2,572					$	6,640
Add: Stock-based compensation expense						$	526					$	456					$	1,585					$	1,297
Non-GAAP gross profit – professional services						$	1,619					$	3,134					$	4,157					$	7,937
Non-GAAP gross margin - professional services						21		%				35		%				21		%				32		%
GAAP income from operations						$	5,903					$	12,817					$	9,296					$	27,756
Add: Stock-based compensation expense(1)						$	26,327					$	25,738					$	81,059					$	80,549
Add: Amortization of acquired intangible assets(2)						$	4,592					$	5,107					$	14,802					$	14,830
Add: Acquisition-related expenses(3)						$	84					$	290					$	450					$	568
Add: Restructuring expense(4)						$	—					$	—					$	—					$	(190)
Non-GAAP income from operations						$	36,906					$	43,952					$	105,607					$	123,513
GAAP net income						$	9,809					$	15,410					$	20,252					$	23,354
Add: Stock-based compensation expense(1)						$	26,327					$	25,738					$	81,059					$	80,549
Add: Amortization of acquired intangible assets(2)						$	4,592					$	5,107					$	14,802					$	14,830
Add: Acquisition-related expenses(3)						$	84					$	290					$	450					$	568
Add: Amortization of debt issuance costs						$	1,098					$	1,217					$	3,116					$	3,325
Add: Discrete tax items(5)						$	—					$	—					$	—					$	6,360
Add: Restructuring expense						$	—					$	—					$	—					$	(190)
Non-GAAP net income						$	41,910					$	47,762					$	119,679					$	128,796
Add: Interest expense of convertible senior notes(6)						$	1,313					$	1,571					$	4,283					$	4,714
Numerator for non-GAAP earnings per share calculation						$	43,223					$	49,333					$	123,962					$	133,510
Weighted average shares used in GAAP earnings per share calculation, basic						$	64,967,114					$	62,898,078					$	64,404,649					$	62,389,482
Dilutive effect of convertible senior notes(6)						$	10,429,891					$	11,183,611					$	10,763,957					$	11,183,611
Dilutive effect of employee equity incentive plans(7)						$	214,827					$	455,396					$	286,430					$	652,017
Weighted average shares used in non-GAAP earnings per share calculation, diluted						$	75,611,832					$	74,537,085					$	75,455,036					$	74,225,110

 

						Three Months Ended September 30,												Nine Months Ended September 30,
						2025						2024						2025						2024
GAAP net income						$	9,809					$	15,410					$	20,252					$	23,354
Interest income						(6,167)						(5,571)						(17,439)						(15,512)
Interest expense						2,585						2,837						7,866						8,180
Other expense (income), net						173						(2,811)						(5,586)						(681)
(Benefit) provision for income taxes						(497)						2,952						4,203						12,415
Depreciation expense						2,339						2,718						7,478						8,401
Amortization of intangible assets						8,861						8,520						26,776						25,056
Stock-based compensation expense						26,327						25,738						81,059						80,549
Acquisition-related expenses						84						290						450						568
Restructuring expense						—						—						—						(190)
Adjusted EBITDA						$	43,514					$	50,083					$	125,059					$	142,140

Note: Certain prior period reflect immaterial corrections. Refer to Note 15, Immaterial Correction of an Error, in the notes to our unaudited condensed consolidated financial statements for further information.

 

						Three Months Ended September 30,												Nine Months Ended September 30,
						2025						2024						2025						2024
Net cash provided by operating activities						$	38,199					$	43,969					$	116,250					$	107,897
Less: Purchases of property and equipment						(4,137)						(1,342)						(6,446)						(2,242)
Less: Capitalized internal-use software costs						(3,951)						(4,125)						(11,984)						(10,414)
Free cash flow						$	30,111					$	38,502					$	97,820					$	95,241

(in millions, except per share data)