APPF

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Release Date: October 22, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. - Revenue grew 19% year-over-year to $296 million, driven by strong new customer acquisition and premium tier upgrades. - GAAP operating income surged 64% to $57 million (19.4% margin), while non-GAAP operating income rose 38% to $81 million (27.3% margin). - Units on platform increased 8% to 9.8 million, and customer count grew 6% to 23,121, with healthy retention. - AI-powered Performers delivered tangible results: Maintenance Performer resolved 53% of requests without work orders, Leasing Performer boosted showings up to 35%, and Accounting Performer saved 17 hours per month. - Full-year revenue guidance raised to $1.122-$1.127 billion (18.3% growth at midpoint), and non-GAAP operating margin guidance increased to 26.5%-27.5% from 24.7% in 2025. - Unit expansion among existing customers is pacing slower than last year and is expected to remain below Q4 2025 levels. - Sales and marketing expense rose to 15% of revenue from 13% last year, reflecting higher advertising, events, and added sales capacity. - Subscription services revenue growth was 14% year-over-year, lagging overall revenue growth of 19%. - Cost of revenue (excl. D&A) remained elevated at 35% of revenue, impacted by payments product mix and incremental data center capacity for AI workloads. - Q4 other revenue will face a tough comparison due to one-time revenue from a Stack partnership in Q4 2025 that is not expected to recur. - Warning! GuruFocus has detected 2 Warning Sign with MXL. - Is APPF fairly valued? Test your thesis with our free DCF calculator. Q: What drove AppFolio's 19% year-over-year revenue growth in Q3 2026, and how did the two revenue streams perform? A: CFO Tim Eaton reported total revenue of $296 million, up 19% from $249 million in Q3 2025. Subscription services revenue grew 14% to $62 million, driven by new customer wins, unit growth and premium tier upgrades, with customers continuing to commit to multiyear agreements. Value-added services revenue grew 21% to $232 million, led by FolioGuard risk mitigation, FolioScreen offerings and online payments, with Resident Onboarding Lift, Resident Concierge and Realm-X Performers increasing their contribution. Q: How did margins expand in the quarter, and what factors should investors consider when comparing to the prior year? A: CFO Tim Eaton said GAAP operating income grew 64% to $57 million, or 19.4% of revenue, versus $35 million, or 14.1%, a year ago. Non-GAAP operating income grew 38% to $81 million, or 27.3% of revenue, compared to 23.5% in Q3 2025. He noted two items: Q3 2025 included an incremental year-to-date accrual for overachievement of the annual corporate bonus plan, which lowered that quarter's margin, and FUTURE took place in Q3 this year versus Q4 2025, moving that expense earlier in the year. Q: What is the outlook for unit expansion among existing customers, and how is it trending? A: CFO Tim Eaton said the company ended the quarter with approximately 9.8 million units, up 8% from 9.1 million a year ago, and customers grew 6% to 23,121. Unit acquisition from new customers remained strong and retention was healthy and consistent with historical averages. However, he noted that while existing customers continue to add units, unit expansion is pacing slower than last year, a trend highlighted on the Q2 call, and is expected to stay below last year's Q4 and comparable to Q3. Q: What is the updated full-year 2026 guidance, and what is driving the margin outlook? A: CFO Tim Eaton raised full-year revenue guidance to $1.122 billion to $1.127 billion, lifting the midpoint growth rate to 18.3%. Full-year non-GAAP operating margin guidance is now 26.5% to 27.5%, compared to 24.7% in 2025. He said the range reflects a deliberate decision to accelerate sales and marketing investment this year, including additional sales capacity, the FUTURE conference and targeted go-to-market programs, while operating expenses as a percentage of revenue are expected to decline modestly as the company scales and applies AI internally. Q: How is AppFolio's AI suite, including Realm-X and the Performers, performing with customers? A: CEO Shane Trigg said the new Realm-X remembers context across conversations, draws on a customer knowledge base and builds custom workflows and dashboards from a prompt, with AI-native capabilities available across every plan. Beta customers reported that Resident Messenger Performer resolved over 30% of conversations without escalation, Accounting Performer saved an average of 17 hours per month, and Leasing Performer boosts showings up to 35%. He also unveiled Receptionist Performer, which will answer incoming calls and route requests at any hour, and noted the Connector for Claude is now available to every customer within AppFolio's permissions and guardrails. Q: What was the significance of the FUTURE customer conference, and how does it support the sales strategy? A: CEO Shane Trigg said FUTURE hosted 2,500 real estate operators across four days, 130 sessions, 19 performance labs and the biggest ever EXPLORE marketplace floor, with more than 60 customers taking the stage as speakers. The theme was that the future will be won by organizations that continuously level up, combining interconnected systems with the right behaviors, which he framed as Real Estate Performance Management, or RPM. CFO Tim Eaton noted the event moved into Q3 this year and contributed to higher sales and marketing expense at 15% of revenue, up from 13% last year. Q: How is the AppFolio Stack partner ecosystem and banking integration expanding? A: CEO Shane Trigg said the Stack integration marketplace now connects 5.6 million units across nearly 100 partners, spanning categories from marketing to accounting, with Apartment List as a newest partner offering pay-per-lease billing through AI matching. He also highlighted Stack banking partnerships with Enterprise Bank & Trust and featured banking partner Column, which bring balances, statements, transfers and controls directly into AppFolio, with transactions matched automatically as they come in so teams only touch exceptions, enabling a truly automated close. Q: Can you share examples of customers achieving transformation on the platform? A: CEO Shane Trigg cited Eucalyptus Real Estate, a family-owned operator managing nearly 14,000 units and 106 tax entities across three cities, which previously ran on paper checks, scanned applications and fax machines. Less than a year after switching in 2025, 85% of receivables are paid online, leasing runs digitally end to end, and 53% of maintenance requests resolve without a work order. He also cited RENOSY by Renters Warehouse, which brought 8,000 units across 25 locations under one corporate entity, found AppFolio properties performed better at lower cost, and standardized on AppFolio, going live with nearly 6,000 units with the remainder in migration. Q: What drove the increase in sales and marketing expense, and how are R&D and G&A trending? A: CFO Tim Eaton said sales and marketing was 15% of revenue, up from 13%, reflecting higher advertising and promotion expense including the largest FUTURE conference to date, plus added sales capacity to drive new unit acquisition, premium tier upgrades and value-added services adoption. Research and development declined to 15% of revenue from 18%, reflecting the prior year bonus accrual and lower personnel costs as AI tools increase engineering productivity and innovation velocity. G&A declined to 6% of revenue from 8% on scale and operational efficiency. Q: How did cash flow and head count trend in the quarter? A: CFO Tim Eaton said AppFolio generated $97 million in operating cash flow during the quarter and ended with $307 million in cash, cash equivalents and current For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Image source: The Motley Fool. Thu, Oct 22, 2026 - Investor Relations - Lori Barker - Chairman and Chief Executive Officer - Shane Trigg - Chief Financial Officer - Timothy Mathias Eaton Operator: Good afternoon. Thank you for standing by, and welcome to AppFolio Inc. Third Quarter 2026 Financial Results Conference Call. Please be advised, today's conference is being recorded. And the replay will be available on AppFolio's Investor Relations website. I would now like to hand the conference over to Lori Barker. Investor Relations. Lori Barker: Thank you. Good afternoon, everyone. I am Lori Barker, Investor Relations for AppFolio, and we thank you for joining us today as we report AppFolio's third quarter 2026 financial results. With me on the call today are Shane Trigg, AppFolio's Chairman and CEO and Timothy Mathias Eaton, AppFolio's CFO. This call is being simultaneously webcast on the Investor Relations section of our website at appfolioinc.com. Additionally, an audio replay of the call and a transcript of the prepared comments will be posted to the website. Before we get started, I would like to remind everyone of AppFolio's safe harbor policy. Comments made during this conference call and webcast contain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 2000 and are subject to risks and uncertainties. Any statement that refers to expectations, projections or other characterizations of future events including financial projections, future market conditions, business performance, or future product enhancements or development is a forward looking statement. AppFolio's actual future results could differ materially from those expressed in such forward looking statements for any reason, including those issued in our SEC filings. AppFolio assumes no obligation to update any such forward looking statements except as required by law. For greater detail about risks and uncertainties, please see our SEC filings, including our Form 10-Ks for the fiscal year ended 12/31/2025 which was filed with the SEC on 02/05/2026. In addition, this call includes non GAAP financial measures. Reconciliation of these non GAAP financial measures to the most directly comparable GAAP measures are included in our third quarter earnings release posted on the Investor Relations section of our website. With that, I turn the call over to Shane Trigg, Shane, please go ahead. Shane Trigg: Thanks, Lori, and welcome to everyone joining us today. Q3 was another quarter of strong consistent performance for AppFolio. Revenue reached $296 million a 19% year over year increase. Non GAAP operating income was 27.3% of revenue and GAAP operating income was 19.4% of revenue. Units on platform grew to 9.8 million. Along with our strong consistent financial results, 1 of the biggest highlights this quarter was Future, our annual industry event. We hosted 2.5 thousand real estate operators and innovators united by our shared ambition to build a future of winning. Across 4 days, 130 sessions, 19 expert led performance labs, and our biggest ever explore floor, our marketplace spanning the AppFolio Performance platform and the partners across our stack ecosystem. Attendees left with tangible ways to deliver performance for their residents, investors, teams, and communities. I felt tremendous pride and gratitude watching 60-plus of our customers taking the stage as future speakers, educating their peers on the ways they have achieved meaningful performance in their own businesses. It was truly a privilege to share our vision with the industry and to watch our customers shape it alongside us. The key theme at future this year was that the future will not be won by organizations that simply keep up. It will be won by organizations that continuously level up. As 1 attendee told us, quote, we are never done striving to get better because the moment we think we are the best is the moment we get left behind. End quote. Achieving a sustained competitive advantage requires 2 things. First, interconnected systems built with performance in mind. A system of record that securely stores data while reflecting the operator's business. A system of action where AI does the work with and for them. And a system of growth that turns exceptional experiences for their residents and owners into growth for their business. Second is behaviors. What a team does with the capacity the systems create. Applying judgment, building relationships, and anticipating rather than reacting. Meeting a resident's need before they ask, and bring an owner a plan, not a problem. Combined systems built for performance with these behaviors and customers achieve real performance. That is real estate performance management or what we call RPM. PURE HomeRiver shows how rapid transformation is possible when an operator picks a platform that has the right systems built in and makes the right behaviors easy to adopt. The fitness-family-owned operator manages nearly 14 thousand units and 106 separate tax entities across Oklahoma City Wichita, and Topeka. Before switching to AppFolio in 2025, they ran their 3 cities independently on paper checks, paper work orders, scanned applications, and fax machines. Less than a year later, 85% of receivables are paid online. Leasing runs digitally from application to signature. A single automated flow delivers move in disclosures consistently across every property. And 53% of maintenance requests now resolve without a work order ever being created. As Joseph Polverari, Co-Founder and CEO of PURE HomeRiver Group put it, we did not move to AppFolio just to change tools. We moved to change how we run this business. 3 cities now work the same way. On the same platform with 1 source of truth. End quote. Customers like Eucalyptus show how real estate performance management works in practice. Combining systems and behaviors to realize performance. Our goal is to enable this type of transformation for any operator in our industry. Because when customers reach new levels of performance, they start asking, what can we do now that we could not do before? They get better experiences for residents and owners, more value for their business, and new versions of what their business can become. Empowering our customers to find those answers is why we differ to win—the first of our 3 strategic pillars. Our performance platform is purpose built for real estate performance management because customers operate on a single system of record that understands the rules of real estate, their business and permissions, every workflow, insight, and action compounds on the same data rather than fragmenting across disconnected point solutions. While operators outside our platform can buy isolated AI features a point solution cannot provide the connected foundation governance, and economic alignment that allows performance to compound month after month, creating an engine for competitive advantage. Within our system of record, expanded entity accounting capabilities are designed to serve multi entity operators, bringing corporate portfolio and credit card accounting into the same data model for a more unified accounting experience. At the same time, we are bringing more of our customers financial data balances, statements, transfers, and controls directly into AppFolio through stack banking partnerships with Enterprise Bank and Trust in our featured banking partner, Column. Through our Column partnership, bank data flows straight into AppFolio, Transactions are matched automatically as they come in. Not just at month end. So teams only touch the exceptions. that is what makes a truly automated close possible. MAX and AppFolio customer managing 3.5 thousand units across Utah, Idaho, and Arizona is seeing the benefit. As Cliff Ledet, principal broker and owner put it, quote, this integration with Column brings our banking and property operations into a more connected process. It gives our accounting team cleaner information and greater confidence in the numbers so we can scale while keeping operations smooth for our team. End quote. In the system of action, includes our AI suite of Realm-X, Flows, and the Connector for Claude, the new Realm-X remembers context across conversations. Draws on a knowledge base where customers store their own documents and policies, and builds custom workflows and dashboards directly from a prompt. With AI native capabilities available across every plan, every customer can move beyond task efficiency to real performance. Realm-X runs alongside a growing suite of Performer agents that each work from the same platform data, and governance. Maintenance performer responds to resident requests in seconds, including after hours. Beta customers reported that Resident Messenger Performer resolved over 30% of conversations without escalation, and Accounting Performer saved an average of 17 hours per month and Leasing Performer boost showings up to 35%. A customer transforming their leasing operations through the Leasing Performer is TR Lawing Realty, a plus 750-unit portfolio in Cedar Falls, Iowa. Since moving off the standalone tool and on the Leasing Performer, Merge has converted automated prospect engagement into move in, averaging nearly 45 leases a month with a pipeline that is the largest it is ever been. As Joe Remsen, a Charlotte-based and operations partner put it, AppFolio has moved us from reactive to proactive. End quote. We are extending the performer suite with Receptionist Performer, unveiled at Future, which will answer incoming calls handle simple questions on the spot, and route everything else to the right performer or person at any hour. And our Connector for Claude is now available to every customer, making sure that every agent action whether it runs through a performer or a third party model like Claude, operates within the permissions and guardrails defined within AppFolio. With full visibility into their business and key workflows, completed on their behalf, operators can turn capacity into opportunity. This is the system of growth. Resident onboarding lift continues to scale and deliver exceptional resident value across the move in moment activating renters insurance, group rate Internet, and other essential services in 1 seamless flow. Certified funds that move in lets residents pay move in costs digitally with guaranteed funds, replacing certified checks from the bank. For operators, it reduces move in friction and payment risk while bringing another part of the financial life cycle on to AppFolio. Our system of growth benefits owners, too. Redesigned owner packets give owners a clearer view of portfolio performance, with stronger data visualization and cash flow reporting so they can see exactly what is happening with their investment. That visibility builds trust and it is 1 more way operators who fully leverage our differentiated platform are pulling ahead. Our second strategic pillar is deliver performance efficiently. Which shows up in how operators choose AppFolio and how much more they get from the platform once they have adopted its capabilities. Take HomeRiver Group. They recently brought 8 thousand units across 25 locations under 1 corporate entity. Once their leadership had a unified view of the business, they discovered properties running on AppFolio performed better. And at a lower cost than the fragmented legacy setup data it inherited. So they standardized on AppFolio. And last quarter went live with a portfolio of nearly 6 thousand units with the remainder in migration, including Maintenance Performer and Resident Messenger Performer. That same connected approach extends to our partner ecosystem. The AppFolio stack integration marketplace now connects 5.6 million units across nearly 100 partners spanning categories from marketing to accounting. Apartment List is 1 of our newest partners offering a pay per lease billing model built to attract qualified renters through AI matching and support occupancy goals. Each new integration creates more value within the unified experience of AppFolio. This momentum is showing up in how the industry recognizes us. AppFolio has ranked No. 1 on the G2 grid for 5 consecutive quarters confirming AppFolio as the platform of choice for real estate operators. In G2's fall 2026 rankings, covering more than 28 thousand reports, AppFolio ranked number 5 among companies by G2 score. None of this happens without the right team behind it. Which brings me to our third and final strategic pillar, great people and culture. Since the quarter closed, AppFolio was named to Fortune's 2026 Best Workplaces in Technology list. A recognition of the culture our people build every day where we show up as 1 team connected by our values. We were also named to Fortune's 2026 Future 21 list, which recognizes the company's best position for future growth. Together, they reflect something we deeply believe, The customer obsessed culture we build and the results we deliver are directly connected. Turning efficiency into capacity, capacity into opportunity into performance, and performance into competitive advantage that compounds over time. that is the promise of real estate performance management. it is the future we are helping our customers to create and the reason for our strong consistent performance. With that, I will turn it over to Timothy to share more about AppFolio's Q3 financial results. Timothy Mathias Eaton: Thank you, Shane. Our third quarter results reflect the consistency of our business. 19% revenue growth, continued strength in new customer acquisition and GAAP operating margin of 19.4%. By combining our growing scale with AI, we are continuing to add value for our customers while driving operational efficiencies. In the third quarter, we delivered revenue of $296 million growing 19% year over year, compared to $249 million in Q3 2025. Subscription services revenue grew 14% year-over-year to $62 million compared to $54 million in the third quarter of 2025. This growth was driven by winning new customers, growth in units under management, and customers continuing to upgrade to our premium tiers. New and renewing customers continue to commit to multiyear agreements, which extends the contracted base of revenue underlying subscription services. Value added services revenue grew 21% year-over-year to $232 million led by our FolioGuard mitigation services, FolioScreen, and online payments. Alongside continued growth in units under management. Resident onboarding lift, resident concierge move in services, and Realm-X Performers are continuing to increase their contribution to value added services revenue. We ended the quarter managing approximately 9.8 million units. An 8% increase from 9.1 million units a year ago. Customers grew to 23.1 thousand up 6% from 21.8 thousand. Unit acquisition from new customers remained strong and retention was healthy and consistent with historical averages. While existing customers continue to add units to our platform, unit expansion is pacing slower than last year, a trend we highlighted during our second quarter call. Turning to margin. In the third quarter, GAAP operating income, which includes stock based compensation expense, grew 64% year-over-year to $57 million or 19.4% of revenue compared to $35 million or 14.1% of revenue a year ago Non GAAP operating income grew 38% to $81 million or 27.3% of revenue compared to $59 million or 23.5% of revenue in the third quarter of 25. 2 items are worth noting when comparing margins to the prior year. First, as we discussed a year ago, the third quarter of 25 included an incremental year to date accrual across cost of revenue in each of our operating expense lines for overachievement of our annual corporate bonus plan. Which lowered that quarter's margin. We did not have a comparable item this quarter. Second, our annual industry event, future, took place in the third quarter this year, compared to the fourth quarter of 2025, which moved that expense earlier in the year. With that context and continuing with non GAAP measures, cost of revenue exclusive of depreciation and amortization was 35% of revenue, down from 36% a year ago. Beyond the prior year bonus accrual, we saw the benefits of scale across both our third party service costs and our customer support and operations teams partially offset by our payments product mix and by incremental data center capacity as more of our customers work runs through Realm-X and Performers. Sales and marketing was 15% of revenue, up from 13% last year. The increase reflects higher advertising and promotion expense, including our largest future conference to date. It also reflects added sales capacity to drive new unit acquisition, premium tier upgrades, value added services adoption. R&D declined to 15% of revenue from 18% in the prior year, reflecting the prior year bonus accrual and lower personnel costs. As AI tools and systems continue to increase, productivity of our engineering teams, and the velocity of our innovation. G&A expense declined to 6% of revenue from 8% in the prior year quarter, Beyond the prior year bonus accrual, the decline reflects the benefits of scale and continued operational efficiency. We exited the quarter with 1.74 thousand employees, An increase of 2% from the third quarter of 25 as we continue to scale revenue ahead of headcount. We generated $97 million in operating cash flow during the quarter, and ended the period with $307 million in cash, cash equivalents and investment securities. Our capital allocation approach remains unchanged. We invest first in the business, and our share repurchase program remains opportunistic. Our balance sheet flexibility allows us to keep investing where it best advances our mission to build the platform real estate comes to do business on. Now turning to our 2026 outlook. We are raising our full year revenue guidance to a range of $1.122 billion to $1.127 billion lifting the midpoint growth rate to 18.3%. For the fourth quarter, we anticipate new customer acquisition, and retention will remain healthy, while the pace of unit expansion among existing customers is expected to stay below last year's fourth quarter and be comparable to the third quarter. We continue to expect subscription services and value added services seasonality to be broadly consistent with 2025. Other revenue can vary from quarter to quarter, and the fourth quarter of 25 included onetime revenue from a stack partnership that we do not expect to recur. Our full year non GAAP operating margin guidance is now 26.5% to 27.5%, compared to 24.7% in 2025, This range reflects a deliberate decision to accelerate our sales and marketing investment this year. Including additional sales capacity, our future conference and other industry events, and targeted go to market programs. Which are visible in our year to date results. While we are investing more in sales and marketing, we expect full year operating expenses as a percentage of revenue to decline modestly as we continue to scale and apply AI across our internal operations. We expect cost of revenue exclusive of depreciation and amortization to be relatively flat as a percentage of revenue compared to 2025. We anticipate diluted weighted average shares outstanding of approximately 36 million for the full year. In closing, the third quarter is another example of what consistency looks like at AppFolio. Strong revenue growth, expanding profitability, healthy cash generation, and disciplined capital allocation. We remain focused on delivering performance for our customers efficiently, so that the value they realize on our platform continues to translate into our results. Thanks to all of you for your support and interest in AppFolio. Operator, this concludes today's call. Operator: Thank you for participating. You may now disconnect. Before you buy stock in AppFolio, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and AppFolio wasn't one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool has positions in and recommends AppFolio. The Motley Fool has a disclosure policy. AppFolio (APPF) Q3 2026 Earnings Call Transcript was originally published by The Motley Fool

AppFolio (APPF) came out with quarterly earnings of $1.82 per share, beating the Zacks Consensus Estimate of $1.78 per share. This compares to earnings of $1.31 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +2.25%. A quarter ago, it was expected that this property management software maker would post earnings of $1.67 per share when it actually produced earnings of $1.71, delivering a surprise of +2.4%. Over the last four quarters, the company has surpassed consensus EPS estimates four times. AppFolio, which belongs to the Zacks Internet - Software industry, posted revenues of $295.69 million for the quarter ended September 2026, surpassing the Zacks Consensus Estimate by 0.47%. This compares to year-ago revenues of $249.35 million. The company has topped consensus revenue estimates four times over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. AppFolio shares have lost about 6.6% since the beginning of the year versus the S&P 500's gain of 13.3%. While AppFolio has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for AppFolio was favorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #2 (Buy) for the stock. So, the shares are expected to outperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.81 on $286.96 million in revenues for the coming quarter and $6.90 on $1.12 billion in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Internet - Software is currently in the top 31% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. Another stock from the same industry, Unity Software Inc. (U), has yet to report results for the quarter ended September 2026. The results are expected to be released on November 5. This company is expected to post quarterly earnings of $0.34 per share in its upcoming report, which represents a year-over-year change of +70%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Unity Software Inc.'s revenues are expected to be $564.84 million, up 20% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AppFolio, Inc. (APPF) : Free Stock Analysis Report Unity Software Inc. (U) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Consistency Continues with 19% Revenue Growth and Expanding Profitability SANTA BARBARA, Calif., Oct. 22, 2026 (GLOBE NEWSWIRE) -- AppFolio, Inc. (NASDAQ: APPF) ("AppFolio" or the "Company"), a technology leader powering the future of the real estate industry, today announced its financial results for the third quarter ended September 30, 2026. "Q3 reflects the strength and durability of our business, as new and existing customers continue to adopt our performance platform," said Shane Trigg, Chairman and CEO. "The promise of Real Estate Performance Management is helping create a future of winning with our customers, turning performance into a competitive advantage that compounds over time." Financial Highlights for Third Quarter of 2026 - Revenue grew 19% year-over-year to $296 million. - Total units under management grew 8% year-over-year to 9.8 million. - GAAP operating income grew 64% to $57 million, or 19.4% of revenue, compared to $35 million, or 14.1% of revenue in Q3 2025. - Non-GAAP operating income grew 38% to $81 million, or 27.3% of revenue, compared to $59 million, or 23.5% of revenue in Q3 2025. - Net cash provided by operating activities was $97 million, or 32.7% of revenue, compared to $86 million, or 34.5% of revenue in Q3 2025. Financial Outlook Based on information available as of October 22, 2026, AppFolio's outlook for fiscal year 2026 follows: - Full year revenue range is increasing to $1.122 - $1.127 billion. - Full year non-GAAP operating margin range as a percentage of revenue is now 26.5% - 27.5%. - Diluted weighted average shares outstanding are expected to be approximately 36 million for the full year. Conference Call Information As previously announced, the Company will host a conference call today, October 22, 2026, at 2:00 p.m. Pacific Time (PT), 5:00 p.m. Eastern Time (ET), to discuss the Company's third quarter financial results. A live webcast of the call will be available at: https://edge.media-server.com/mmc/p/jcjgqabv. To access the call by phone, please go to the following link: https://register-conf.media-server.com/register/BI59a3520d44444834b693d21914243efb, and you will be provided with dial-in details. A replay of the webcast will also be available for a limited time on AppFolio's Investor Relations website at https://ir.appfolioinc.com/news-events/events. The Company also provides announcements regarding its financial results and other matters, including SEC filings, investor events, and press releases, on its Investor Relations website at https://ir.appfolioinc.com/, as a means of disclosing material nonpublic information and for complying with AppFolio's disclosure obligations under Regulation FD. About AppFolio AppFolio is a technology leader powering the future of the real estate industry. Our innovative platform and trusted partnership enable our customers to connect communities, increase operational efficiency, and grow their business. For more information about AppFolio, visit ir.appfolioinc.com. Investor Relations Contact: Lori Barker [email protected] Use of Non-GAAP Financial Measures Reconciliations of current and historical non-GAAP financial measures to AppFolio's financial results as determined in accordance with GAAP are included at the end of this press release following the accompanying financial data. For a description of these non-GAAP financial measures, including the reasons management uses each measure, please see the section of the tables entitled "Statement Regarding the Use of Non-GAAP Financial Measures." AppFolio is unable, at this time, to provide GAAP equivalent guidance measures on a forward-looking basis for non-GAAP operating margin because certain items that impact this measure are uncertain, out of our control, or cannot be reasonably predicted, such as charges related to stock-based compensation expense. The effect of these excluded items may be significant. Forward-Looking Statements This press release contains "forward-looking statements" within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, which statements are subject to considerable risks and uncertainties. Forward-looking statements include all statements that are not statements of historical fact contained in this press release, and can be identified by words such as "anticipates," "believes," "could," "estimates," "expects," "intends," "may," "plans," "potential," "future'" "predicts, "projects," "target," "seeks," "contemplates," "should," "will," "would" or similar expressions and the negatives of those expressions. In particular, forward-looking statements contained in this press release relate to future operating results and financial position, including the Company's fiscal year 2026 financial outlook, anticipated future expenses and investments, the Company's business opportunities, the impact of the Company's strategic actions and initiatives, the potential benefits and effect of AI and its impact on the Company's plans, objectives, expectations and capabilities. Forward-looking statements represent AppFolio's current beliefs and expectations based on information currently available and speak only as of the date the statement is made. Forward-looking statements are subject to numerous known and unknown risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. The risks, uncertainties and other factors that may cause the Company's actual results, performance or achievements to materially differ from those expressed or implied by these forward-looking statements include those risks, uncertainties and other factors described in the section entitled "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2025, which was filed with the SEC on February 5, 2026, as such risk factors may be updated from time to time in our subsequent filings with the SEC, and the section entitled "Management's Discussion and Analysis of Financial Condition and Results of Operations" in the Company's most recently filed Annual Report on Form 10-K or Quarterly Report on Form 10-Q, as well as in the Company's other filings with the SEC. You should read this press release with the understanding that the Company's actual future results may be materially different from the results expressed or implied by these forward-looking statements. The Company undertakes no obligation to update any forward-looking statements made in this press release to reflect events or circumstances after the date of this press release or to reflect new information or the occurrence of unanticipated events, except as required by law. CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands) | | September 30, 2026 | | December 31, 2025 Assets | | | | Current assets | | | | Cash and cash equivalents | | $ | 258,536 | | $ | 106,967 Investment securities—current | | | 48,740 | | | 144,256 Accounts receivable, net | | | 52,535 | | | 36,873 Prepaid expenses and other current assets | | | 47,561 | | | 65,218 Total current assets | | | 407,372 | | | 353,314 Property and equipment, net | | | 20,316 | | | 23,228 Operating lease right-of-use assets | | | 14,227 | | | 15,924 Capitalized software development costs, net | | | 11,122 | | | 11,324 Goodwill | | | 96,410 | | | 96,410 Intangible assets, net | | | 31,153 | | | 38,826 Deferred income taxes | | | 32,210 | | | 58,823 Long-term investments | | | 87,668 | | | 77,033 Other long-term assets | | | 15,193 | | | 14,085 Total assets | | $ | 715,671 | | $ | 688,967 Liabilities and Stockholders' Equity | | | | Current liabilities | | | | Accounts payable | | $ | 5,656 | | $ | 4,123 Accrued employee expenses | | | 43,071 | | | 59,774 Accrued expenses | | | 28,679 | | | 20,829 Other current liabilities | | | 24,476 | | | 22,121 Total current liabilities | | | 101,882 | | | 106,847 Operating lease liabilities | | | 24,876 | | | 33,287 Other liabilities | | | 6,399 | | | 6,254 Total liabilities | | | 133,157 | | | 146,388 Stockholders' equity | | | 582,514 | | | 542,579 Total liabilities and stockholders' equity | | $ | 715,671 | | $ | 688,967 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) (in thousands, except per share amounts) | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2026 | | | | 2025 | | | | 2026 | | | 2025 Revenue(1) | $ | 295,691 | | | $ | 249,353 | | | $ | 839,029 | | $ | 702,630 Costs and operating expenses: | | | | | | | Cost of revenue (exclusive of depreciation and amortization)(2) | | 105,580 | | | | 91,476 | | | | 303,150 | | | 254,801 Sales and marketing(2) | | 48,623 | | | | 35,912 | | | | 130,068 | | | 103,745 Research and product development(2) | | 53,128 | | | | 54,037 | | | | 153,754 | | | 144,469 General and administrative(2) | | 25,953 | | | | 27,446 | | | | 75,920 | | | 72,733 Depreciation and amortization | | 4,996 | | | | 5,436 | | | | 15,001 | | | 17,541 Total costs and operating expenses | | 238,280 | | | | 214,307 | | | | 677,893 | | | 593,289 Income from operations | | 57,411 | | | | 35,046 | | | | 161,136 | | | 109,341 Other (loss) income, net | | (1 | ) | | | (4 | ) | | | 567 | | | 41 Interest income, net | | 2,204 | | | | 1,690 | | | | 5,423 | | | 6,109 Income before provision for income taxes | | 59,614 | | | | 36,732 | | | | 167,126 | | | 115,491 Provision for income taxes | | 13,636 | | | | 3,086 | | | | 37,180 | | | 14,482 Net income | $ | 45,978 | | | $ | 33,646 | | | $ | 129,946 | | $ | 101,009 Net income per common share: | | | | | | | Basic | $ | 1.30 | | | $ | 0.94 | | | $ | 3.66 | | $ | 2.80 Diluted | $ | 1.29 | | | $ | 0.93 | | | $ | 3.65 | | $ | 2.78 Weighted average common shares outstanding | | | | | | | Basic | | 35,436 | | | | 35,889 | | | | 35,507 | | | 36,036 Diluted | | 35,578 | | | | 36,259 | | | | 35,616 | | | 36,368 (1) The following table presents our revenue categories: | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2026 | | | 2025 | | | 2026 | | | 2025 Subscription Services | $ | 61,525 | | $ | 53,752 | | $ | 179,547 | | $ | 155,738 Value Added Services | | 231,948 | | | 192,092 | | | 652,778 | | | 536,943 Other | | 2,218 | | | 3,509 | | | 6,704 | | | 9,949 Total revenue | $ | 295,691 | | $ | 249,353 | | $ | 839,029 | | $ | 702,630 (2) Includes stock-based compensation expense as follows: | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2026 | | | 2025 | | | 2026 | | | 2025 Costs and operating expenses: | | | | | | | Cost of revenue (exclusive of depreciation and amortization) | $ | 1,315 | | $ | 1,241 | | $ | 3,649 | | $ | 3,947 Sales and marketing | | 3,586 | | | 3,443 | | | 10,559 | | | 9,336 Research and product development | | 8,839 | | | 9,076 | | | 25,639 | | | 24,182 General and administrative | | 6,860 | | | 7,033 | | | 19,213 | | | 17,998 Total stock-based compensation expense | $ | 20,600 | | $ | 20,793 | | $ | 59,060 | | $ | 55,463 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) | Three Months Ended September 30, | | Nine Months Ended September 30, | | 2026 | | | | 2025 | | | | 2026 | | | | 2025 | Cash from operating activities | | | | | | | Net income | $ | 45,978 | | | $ | 33,646 | | | $ | 129,946 | | | $ | 101,009 | Adjustments to reconcile net income to net cash provided by operating activities: | | | | | | | Depreciation and amortization | | 4,996 | | | | 5,436 | | | | 15,001 | | | | 17,541 | Amortization of operating lease right-of-use assets | | 572 | | | | 517 | | | | 1,698 | | | | 1,525 | Gain on lease termination and modification | | (1,547 | ) | | | — | | | | (1,547 | ) | | | — | Amortization of costs capitalized to obtain revenue contracts, net | | 3,428 | | | | 2,768 | | | | 9,896 | | | | 8,187 | Deferred income taxes | | 10,609 | | | | 30,303 | | | | 26,613 | | | | 17,118 | Stock-based compensation, including as amortized | | 20,600 | | | | 20,793 | | | | 59,060 | | | | 55,463 | Other | | 3 | | | | (233 | ) | | | (520 | ) | | | (1,281 | ) Changes in operating assets and liabilities: | | | | | | | Accounts receivable | | (2,094 | ) | | | (1,803 | ) | | | (16,012 | ) | | | (10,000 | ) Prepaid expenses and other assets | | 160 | | | | (4,251 | ) | | | (9,933 | ) | | | (15,677 | ) Accounts payable | | 881 | | | | 894 | | | | 1,534 | | | | 1,746 | Operating lease liabilities | | (4,941 | ) | | | (1,075 | ) | | | (7,325 | ) | | | (3,177 | ) Accrued expenses and other liabilities | | 18,121 | | | | (988 | ) | | | 10,257 | | | | 4,661 | Net cash provided by operating activities | | 96,766 | | | | 86,007 | | | | 218,668 | | | | 177,115 | Cash from investing activities | | | | | | | Purchases of available-for-sale investments | | (46,195 | ) | | | (102,541 | ) | | | (92,135 | ) | | | (166,575 | ) Proceeds from sales of available-for-sale investments | | — | | | | — | | | | 140,154 | | | | 202,662 | Proceeds from maturities of available-for-sale investments | | 1,810 | | | | 32,800 | | | | 47,400 | | | | 76,620 | Purchases of property and equipment | | (14 | ) | | | (1,336 | ) | | | (242 | ) | | | (1,841 | ) Proceeds from sale of property and equipment | | 75 | | | | — | | | | 75 | | | | — | Capitalization of software development costs | | (983 | ) | | | (936 | ) | | | (3,537 | ) | | | (2,414 | ) Purchases of long-term investments | | — | | | | — | | | | (10,000 | ) | | | (75,000 | ) Cash paid in business acquisition, net of cash acquired | | — | | | | — | | | | — | | | | (906 | ) Net cash (used in) provided by investing activities | | (45,307 | ) | | | (72,013 | ) | | | 81,715 | | | | 32,546 | Cash from financing activities | | | | | | | Proceeds from stock option exercises and the issuance of common stock under the Employee Stock Purchase Plan | | 1,084 | | | | 953 | | | | 2,082 | | | | 1,081 | Tax withholding for net share settlement | | (7,228 | ) | | | (12,332 | ) | | | (21,706 | ) | | | (31,430 | ) Purchase of common stock | | (4,180 | ) | | | — | | | | (129,190 | ) | | | (145,723 | ) Net cash used in financing activities | | (10,324 | ) | | | (11,379 | ) | | | (148,814 | ) | | | (176,072 | ) Net increase in cash, cash equivalents and restricted cash | | 41,135 | | | | 2,615 | | | | 151,569 | | | | 33,589 | Cash, cash equivalents and restricted cash | | | | | | | Beginning of period | | 217,651 | | | | 73,728 | | | | 107,217 | | | | 42,754 | End of period | $ | 258,786 | | | $ | 76,343 | | | $ | 258,786 | | | $ | 76,343 | | | RECONCILIATION FROM GAAP TO NON-GAAP RESULTS (UNAUDITED) (in thousands, except per share data) | | | | | | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | | | 2026 | | | | 2025 | | | | 2026 | | | | 2025 | Costs and operating expenses: | | | | | | GAAP cost of revenue (exclusive of depreciation and amortization) | $ | 105,580 | | | $ | 91,476 | | | $ | 303,150 | | | $ | 254,801 | | | Stock-based compensation expense | | (1,315 | ) | | | (1,241 | ) | | | (3,649 | ) | | | (3,947 | ) | Non-GAAP cost of revenue (exclusive of depreciation and amortization) | $ | 104,265 | | | $ | 90,235 | | | $ | 299,501 | | | $ | 250,854 | | GAAP cost of revenue (exclusive of depreciation and amortization) as a percentage of revenue | | 36 | % | | | 37 | % | | | 36 | % | | | 36 | % | Non-GAAP cost of revenue (exclusive of depreciation and amortization) as a percentage of revenue | | 35 | % | | | 36 | % | | | 36 | % | | | 36 | % | | | | | | | | | | GAAP sales and marketing | $ | 48,623 | | | $ | 35,912 | | | $ | 130,068 | | | $ | 103,745 | | | Stock-based compensation expense | | (3,586 | ) | | | (3,443 | ) | | | (10,559 | ) | | | (9,336 | ) | Non-GAAP sales and marketing | $ | 45,037 | | | $ | 32,469 | | | $ | 119,509 | | | $ | 94,409 | | GAAP sales and marketing as a percentage of revenue | | 16 | % | | | 14 | % | | | 16 | % | | | 15 | % | Non-GAAP sales and marketing as a percentage of revenue | | 15 | % | | | 13 | % | | | 14 | % | | | 13 | % | | | | | | | | | | GAAP research and product development | $ | 53,128 | | | $ | 54,037 | | | $ | 153,754 | | | $ | 144,469 | | | Stock-based compensation expense | | (8,839 | ) | | | (9,076 | ) | | | (25,639 | ) | | | (24,182 | ) | Non-GAAP research and product development | $ | 44,289 | | | $ | 44,961 | | | $ | 128,115 | | | $ | 120,287 | | GAAP research and product development as a percentage of revenue | | 18 | % | | | 22 | % | | | 18 | % | | | 21 | % | Non-GAAP research and product development as a percentage of revenue | | 15 | % | | | 18 | % | | | 15 | % | | | 17 | % | | | | | | | | | | GAAP general and administrative | $ | 25,953 | | | $ | 27,446 | | | $ | 75,920 | | | $ | 72,733 | | | Stock-based compensation expense | | (6,860 | ) | | | (7,033 | ) | | | (19,213 | ) | | | (17,998 | ) | Non-GAAP general and administrative | $ | 19,093 | | | $ | 20,413 | | | $ | 56,707 | | | $ | 54,735 | | GAAP general and administrative as a percentage of revenue | | 9 | % | | | 11 | % | | | 9 | % | | | 10 | % | Non-GAAP general and administrative as a percentage of revenue | | 6 | % | | | 8 | % | | | 7 | % | | | 8 | % | | | | | | | | | | GAAP depreciation and amortization | $ | 4,996 | | | $ | 5,436 | | | $ | 15,001 | | | $ | 17,541 | | | Amortization of stock-based compensation capitalized in software development costs | | (153 | ) | | | (241 | ) | | | (634 | ) | | | (723 | ) | | Amortization of purchased intangibles | | (2,558 | ) | | | (2,558 | ) | | | (7,673 | ) | | | (7,673 | ) | Non-GAAP depreciation and amortization | $ | 2,285 | | | $ | 2,637 | | | $ | 6,694 | | | $ | 9,145 | | GAAP depreciation and amortization as a percentage of revenue | | 2 | % | | | 2 | % | | | 2 | % | | | 2 | % | Non-GAAP depreciation and amortization as a percentage of revenue | | 1 | % | | | 1 | % | | | 1 | % | | | 1 | % | | | Three Months Ended September 30, | | Nine Months Ended September 30, | | | | 2026 | | | | 2025 | | | | 2026 | | | | 2025 | Income from operations: | | | | | | | | GAAP income from operations | $ | 57,411 | | | $ | 35,046 | | | $ | 161,136 | | | $ | 109,341 | | | Stock-based compensation expense | | 20,600 | | | | 20,793 | | | | 59,060 | | | | 55,463 | | | Amortization of stock-based compensation capitalized in software development costs | | 153 | | | | 241 | | | | 634 | | | | 723 | | | Amortization of purchased intangibles | | 2,558 | | | | 2,558 | | | | 7,673 | | | | 7,673 | | Non-GAAP income from operations | $ | 80,722 | | | $ | 58,638 | | | $ | 228,503 | | | $ | 173,200 | | | | | | | | | | Operating margin: | | | | | | | | GAAP operating margin | | 19.4 | % | | | 14.1 | % | | | 19.2 | % | | | 15.6 | % | | Stock-based compensation expense as a percentage of revenue | | 7.0 | | | | 8.3 | | | | 7.0 | | | | 7.9 | | | Amortization of stock-based compensation capitalized in software development costs as a percentage of revenue | | — | | | | 0.1 | | | | 0.1 | | | | 0.1 | | | Amortization of purchased intangibles as a percentage of revenue | | 0.9 | | | | 1.0 | | | | 0.9 | | | | 1.1 | | Non-GAAP operating margin | | 27.3 | % | | | 23.5 | % | | | 27.2 | % | | | 24.7 | % | | | | | | | | | Net income (loss): | | | | | | | | GAAP net income | $ | 45,978 | | | $ | 33,646 | | | $ | 129,946 | | | $ | 101,009 | | | Stock-based compensation expense | | 20,600 | | | | 20,793 | | | | 59,060 | | | | 55,463 | | | Amortization of stock-based compensation capitalized in software development costs | | 153 | | | | 241 | | | | 634 | | | | 723 | | | Amortization of purchased intangibles | | 2,558 | | | | 2,558 | | | | 7,673 | | | | 7,673 | | | Income tax effect of adjustments | | (4,608 | ) | | | (9,582 | ) | | | (14,408 | ) | | | (23,182 | ) | Non-GAAP net income | $ | 64,681 | | | $ | 47,656 | | | $ | 182,905 | | | $ | 141,686 | | | | | | | | | | Net income per share, basic: | | | | | | | | GAAP net income per share, basic | $ | 1.30 | | | $ | 0.94 | | | $ | 3.66 | | | $ | 2.80 | | | Non-GAAP adjustments to net income | | 0.53 | | | | 0.39 | | | | 1.49 | | | | 1.13 | | Non-GAAP net income per share, basic | $ | 1.83 | | | $ | 1.33 | | | $ | 5.15 | | | $ | 3.93 | | | | | | | | | | Net income per share, diluted: | | | | | | | | GAAP net income per share, diluted | $ | 1.29 | | | $ | 0.93 | | | $ | 3.65 | | | $ | 2.78 | | | Non-GAAP adjustments to net income | | 0.53 | | | | 0.38 | | | | 1.49 | | | | 1.12 | | Non-GAAP net income per share, diluted | $ | 1.82 | | | $ | 1.31 | | | $ | 5.14 | | | $ | 3.90 | | | | | | | | | | | Weighted-average shares used in GAAP and non-GAAP per share calculation | | | | | | | | | Basic | | 35,436 | | | | 35,889 | | | | 35,507 | | | | 36,036 | | | Diluted | | 35,578 | | | | 36,259 | | | | 35,616 | | | | 36,368 | Statement Regarding the Use of Non-GAAP Financial Measures We use the following non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. - Non-GAAP presentation of income from operations, costs and operating expenses, operating margin, net income, and net income per share. These measures exclude certain non-cash or non-recurring items, including stock-based compensation expense, amortization of stock-based compensation capitalized in software development costs, amortization of purchased intangibles, and the related income tax effect of these adjustments, as applicable and described below. Non-GAAP operating margin is calculated as non-GAAP operating income from operations as a percentage of revenue. We use each of these non-GAAP financial measures internally to assess and compare operating results across reporting periods, for internal budgeting and forecasting purposes, and to evaluate our financial performance. We believe these non-GAAP financial measures also provide useful supplemental information to investors and facilitate the analysis of our operating results and comparison of operating results across reporting periods. In particular, we believe these non-GAAP financial measures are useful to investors and others in assessing our operating performance due to the following factors: - Stock-based compensation expense and amortization of stock-based compensation capitalized in software development costs. We utilize stock-based compensation to attract and retain employees. It is principally aimed at aligning their interests with those of our stockholders while ensuring long-term retention, rather than to address operational performance for any particular period. As a result, stock-based compensation expenses vary for reasons that are generally unrelated to financial and operational performance in any particular period. - Amortization of purchased intangibles. We view amortization of purchased intangible assets as items arising from pre-acquisition activities determined at the time of an acquisition. While these intangible assets are evaluated for impairment regularly, amortization of the cost of purchased intangibles is an expense that is not typically affected by operations during any particular period. - Income tax effects of adjustments. We utilize a fixed long-term projected tax rate in our computation of non-GAAP income tax effects to provide better consistency across interim reporting periods. In projecting this long-term non-GAAP tax rate, we utilize a financial projection that excludes the direct impact of other non-GAAP adjustments. The projected rate, which we have determined to be 22% and 21% for 2026 and 2025, respectively, considers other factors such as our current operating structure, existing tax positions in various jurisdictions, and key legislation in major jurisdictions where we operate. We periodically re-evaluate this tax rate, as necessary, for significant events, based on relevant tax law changes, and material changes in the forecasted geographic earnings mix. 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 may calculate non-GAAP financial results differently. In addition, there are limitations in using non-GAAP financial measures because non-GAAP financial measures are not prepared in accordance with GAAP and can exclude expenses that may have a material impact on our reported financial results. As such, non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information prepared in accordance with GAAP. A reconciliation of the historical non-GAAP financial measures to their most directly comparable GAAP measures has been provided in the tables above. We encourage investors to review the reconciliation of these historical non-GAAP financial measures to their most directly comparable GAAP financial measures.

- Interested in AppFolio, Inc.? Here are five stocks we like better. - Strong Q3 performance: AppFolio's revenue rose 19% year over year to $296 million, while GAAP operating income increased 64% to $57 million. Growth was driven by customer additions, higher units under management and increased adoption of value-added services. - Platform and AI expansion: Units on the platform grew 8% to 9.8 million and customers increased 6% to 23,121. AppFolio continued expanding its AI tools, banking partnerships and integration marketplace, with early products showing improvements in workflow efficiency, leasing activity and customer-service automation. - Higher 2026 outlook: The company raised full-year revenue guidance to $1.122 billion–$1.127 billion and expects a 26.5%–27.5% non-GAAP operating margin. Existing-customer unit expansion remains slower than last year, while AppFolio plans continued sales and marketing investment. AppFolio (NASDAQ:APPF) reported third-quarter 2026 revenue of $296 million, up 19% from $249 million a year earlier, as the real estate software provider added customers and units on its platform and expanded adoption of value-added services. GAAP operating income rose 64% year over year to $57 million, representing 19.4% of revenue, compared with $35 million, or 14.1% of revenue, in the prior-year quarter. Non-GAAP operating income increased 38% to $81 million, or 27.3% of revenue, from $59 million, or 23.5% of revenue, in the third quarter of 2025. → Aurora Rejects Curaleaf's Higher Bid, But the Takeover Fight Isn't Over Chairman and CEO Shane Trigg said the company's results reflected "strong, consistent performance," while highlighting its annual FUTURE industry event, which hosted 2,500 real estate operators and innovators. The event focused on the company's real estate performance management strategy, which combines a unified system of record, AI-enabled workflows and tools intended to help customers grow their businesses. Subscription services revenue increased 14% to $62 million, driven by new customer wins, growth in units under management and customer upgrades to premium tiers, Chief Financial Officer Tim Eaton said. Value-added services revenue climbed 21% to $232 million, led by FolioGuard risk-mitigation services, FolioScreen offerings, online payments and growth in managed units. → Could Quantinuum's Breakthrough Make Its Sell-Off a Bargain? AppFolio ended the quarter with approximately 9.8 million units on its platform, an 8% increase from 9.1 million a year earlier. Its customer count grew 6% to 23,121 from 21,759. Eaton said new-customer unit acquisition remained strong and retention was healthy and consistent with historical averages. However, unit expansion among existing customers continued to grow at a slower pace than in the prior year, a trend the company had previously discussed during its second-quarter call. - Subscription services revenue: $62 million, up 14% year over year. - Value-added services revenue: $232 million, up 21% year over year. - Units on platform: 9.8 million, up 8% year over year. - Customers: 23,121, up 6% year over year. - Operating cash flow: $97 million. - Cash equivalents and current investment securities: $307 million at quarter-end. → IonQ's Bold Expansion Could Leave Shareholders Paying the Price Trigg outlined AppFolio's continuing expansion of its AI suite, including Realm-X, Performers, Flows and a connector for Claude. He said the new Realm-X can retain context across conversations, use customer-provided documents and policies in a knowledge base, and build workflows and dashboards from prompts. The company said beta customers using Resident Messenger Performer resolved more than 30% of conversations without escalation. Accounting Performer saved users an average of 17 hours per month, while Leasing Performer increased showings by as much as 35%, according to Trigg. AppFolio also introduced Receptionist Performer at its FUTURE event. The product is designed to answer incoming calls, address basic questions and route other inquiries to the appropriate person or Performer. The company said its Claude connector is now available to all customers and is intended to keep actions taken by third-party models within AppFolio's platform permissions and guardrails. On the financial-services side, Trigg said the company is expanding Stack Banking partnerships with Enterprise Bank & Trust and Column. Through the Column relationship, bank data flows into AppFolio, with transactions matched as they arrive rather than only at month-end. The AppFolio Stack Integration Marketplace now connects 5.6 million units across nearly 100 partners, the company said. Apartment List was among the newest partners, offering a pay-per-lease billing model aimed at attracting qualified renters. Eaton said third-quarter comparisons with the prior year were affected by two timing items. The third quarter of 2025 included an incremental year-to-date accrual for overachievement of the annual corporate bonus plan, which reduced prior-year margins. In addition, AppFolio's FUTURE event occurred in the third quarter of 2026, compared with the fourth quarter in 2025. Non-GAAP cost of revenue, excluding depreciation and amortization, was 35% of revenue, down from 36% a year earlier. Sales and marketing expense was 15% of revenue, up from 13%, reflecting higher advertising and promotion, the company's larger FUTURE conference and additional sales capacity. Research and development expense declined to 15% of revenue from 18%, while general and administrative expense fell to 6% of revenue from 8%. Eaton attributed those declines to the prior-year bonus accrual, operational efficiency and productivity gains from AI tools and systems. AppFolio exited the quarter with 1,744 employees, up 2% from the prior-year period. The company said it continued to scale revenue ahead of headcount. AppFolio raised its full-year 2026 revenue guidance to a range of $1.122 billion to $1.127 billion, implying midpoint growth of 18.3%. The company now expects full-year non-GAAP operating margin of 26.5% to 27.5%, compared with 24.7% in 2025. For the fourth quarter, Eaton said AppFolio expects new-customer acquisition and retention to remain healthy. Existing-customer unit expansion is expected to remain below the pace of the prior-year fourth quarter and be comparable with the third quarter. The company plans to continue investing in sales and marketing, including additional sales capacity, industry events and targeted go-to-market programs. Despite those investments, AppFolio expects full-year operating expenses as a percentage of revenue to decline modestly as it scales and applies AI across internal operations. AppFolio, Inc is a cloud-based software company that provides technology solutions for the real estate industry. Its platform is designed primarily for property management businesses, helping them manage accounting, leasing, maintenance, communications, payments, reporting and other operational activities through a centralized system. The company's products serve a range of property managers, including those overseeing residential, commercial, community association, student housing and senior living properties. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "AppFolio Q3 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for October 2026.

- Analysts recently projected that AppFolio could post quarterly earnings of $1.78 per share on revenue of about $293.84 million, with Subscription and Value Added Services expected to contribute a larger share of the top line than in the prior year period. - This focus on expanding higher value services suggests management is emphasizing deeper monetization of existing units rather than relying solely on adding more properties to the platform. - We will now explore how this focus on revenue from Subscription and Value Added Services could influence AppFolio's broader investment narrative. Spot 21 high quality undiscovered gems that, like AppFolio, are aiming to grow earnings by deepening revenue from higher value services rather than just chasing more customer volume. To own AppFolio, you need to trust that the real value sits in earning more from each property on the platform through Subscription and Value Added Services. The fresh earnings and revenue projections point squarely at that thesis. If these higher value lines keep gaining share as expected, the key near term catalyst remains monetization depth rather than sheer unit growth. The biggest tension is cost pressure from heavier use of AI tools and payments, with cost of revenue recently holding near 36% of sales. If usage keeps tilting toward these expense heavy services faster than pricing and efficiency improve, margins could disappoint even if the top line tracks current forecasts. The upcoming report, which is built around US$1.78 in quarterly earnings per share and US$293.84 million in revenue expectations, is the operational update that matters most here. Subscription Services revenue is projected at about US$62.40 million, and a larger mix from Subscription and Value Added Services would align closely with AppFolio's focus on revenue per unit. For you, the key question is execution against that mix shift. Strong delivery on Subscription and Value Added Services supports the long running catalysts around AI powered Realm usage, premium tier adoption and resident services. A softer print in those segments, or heavier than expected cloud and payments costs, would lean into the existing margin and valuation risks already flagged by analysts. AppFolio's longer term story now comes with clear numbers attached. Analysts are working off revenue growth assumptions of 16.8% a year over the next three years, with earnings today at about US$157.5 million and a consensus view that profit could reach US$311.9 million by 2029. That move implies roughly a 2x earnings increase over the period, helped by a projected margin shift from 15.1% to 18.8% if the mix of Subscription and Value Added Services keeps leaning toward higher priced tiers and resident facing add ons rather than pure volume. This level of earnings power is also tied to a specific capital markets setup. The current Simply Wall St report outlines a scenario where AppFolio trades on a P/E of 32.9x those 2029 earnings compared with 45.9x today, with analysts using an 8.6% discount rate and building in a 1.4% yearly decline in the share count over the next three years. For you, that means the upside case is not only about growing revenue per property but also about the market being willing to pay a still premium multiple relative to the US software sector, which is cited at 29.8x earnings. On top of the earnings path, the valuation work implies a specific revenue scale. To line up with the consensus price target of US$236.04, the projections require AppFolio to reach about US$1.7b of sales by 2029 while converting that into US$311.9 million of net profit. The more bullish forecasts in the group see earnings as high as US$373.3 million on a similar time frame, although there is also a more cautious end of the range that comes through in price targets as low as US$200. You are being asked to judge not just whether the Subscription and Value Added Services thesis plays out, but where inside that spread of outcomes the business actually lands. AppFolio's narrative projects about US$1.7b in revenue and US$311.9 million in earnings by 2029. This setup assumes revenue grows at roughly 16.8% a year and earnings roughly double from about US$157.5 million today to reach that 2029 consensus level. Uncover why AppFolio's fair value indicates a 6% potential upside to its current price that may not last much longer. One alternate view leans hard into demand risk. Those analysts worry that if property managers trim budgets, AppFolio's Plus and Max tiers and resident services could hit a ceiling. Their pre news models still assume about US$1.7b of 2029 revenue and US$306.7 million in earnings, yet they see only a modest 6.5% upside. That more cautious stance shows how far opinions can spread and why it is worth weighing several narratives as fresh Q3 numbers arrive. Explore 4 other AppFolio fair value estimates, including one that suggests it could be worth just $217.29. Disagree with existing narratives? Extraordinary investment returns rarely come from following the herd, so consider your own analysis and judgment. - A useful starting point for your AppFolio research is our analysis highlighting 2 key rewards and 2 important warning signs that could impact your investment decision. - See our latest analysis for AppFolio. The report includes a comprehensive fundamental analysis summarized in a single visual, the Snowflake, which makes it easier to evaluate AppFolio's overall financial health at a glance. Once you have a view on AppFolio, it can be useful to compare it with other businesses that share similar qualities or offer different risk and income profiles. The Simply Wall St Screener lets you filter the market quickly so you can focus on a shortlist that fits your approach. - If you prefer steadier prospects with an emphasis on capital preservation, consider reviewing 31 resilient stocks with low risk scores which may better match a more cautious style. - If you are seeking stronger balance sheet quality and fundamentals, you can use the list of solid balance sheet and fundamentals (25 results) to see which other businesses meet a similar standard. - Investors looking for potentially mispriced opportunities can explore the 34 high quality undervalued stocks to identify where the market might be underestimating future earnings power. 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. Companies discussed in this article include APPF. Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email [email protected]

Wall Street analysts forecast that AppFolio (APPF) will report quarterly earnings of $1.78 per share in its upcoming release, pointing to a year-over-year increase of 35.9%. It is anticipated that revenues will amount to $293.84 million, exhibiting an increase of 17.8% compared to the year-ago quarter. Over the last 30 days, there has been no revision in the consensus EPS estimate for the quarter. This signifies the covering analysts' collective reconsideration of their initial forecasts over the course of this timeframe. Ahead of a company's earnings disclosure, it is crucial to give due consideration to changes in earnings estimates. These revisions serve as a noteworthy factor in predicting potential investor reactions to the stock. Numerous empirical studies consistently demonstrate a strong relationship between trends in earnings estimate revision and the short-term price performance of a stock. While investors usually depend on consensus earnings and revenue estimates to assess the business performance for the quarter, delving into analysts' forecasts for certain key metrics often provides a more comprehensive understanding. With that in mind, let's delve into the average projections of some AppFolio metrics that are commonly tracked and projected by analysts on Wall Street. Analysts' assessment points toward 'Revenue- Other' reaching $1.93 million. The estimate points to a change of -45% from the year-ago quarter. The average prediction of analysts places 'Revenue- Value Added Services' at $230.99 million. The estimate suggests a change of +20.3% year over year. The consensus estimate for 'Revenue- Subscription Services' stands at $62.40 million. The estimate indicates a year-over-year change of +16.1%. View all Key Company Metrics for AppFolio here>>> AppFolio shares have witnessed a change of -1.2% in the past month, in contrast to the Zacks S&P 500 composite's +1.5% move. With a Zacks Rank #2 (Buy), APPF is expected outperform the overall market performance in the near term. You can see the complete list of today's Zacks Rank #1 (Strong Buy) stocks here >>>> . Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AppFolio, Inc. (APPF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

The market expects AppFolio (APPF) to deliver a year-over-year increase in earnings on higher revenues when it reports results for the quarter ended September 2026. This widely-known consensus outlook is important in assessing the company's earnings picture, but a powerful factor that might influence its near-term stock price is how the actual results compare to these estimates. The stock might move higher if these key numbers top expectations in the upcoming earnings report, which is expected to be released on October 22. On the other hand, if they miss, the stock may move lower. While the sustainability of the immediate price change and future earnings expectations will mostly depend on management's discussion of business conditions on the earnings call, it's worth handicapping the probability of a positive EPS surprise. This property management software maker is expected to post quarterly earnings of $1.77 per share in its upcoming report, which represents a year-over-year change of +35.1%. Revenues are expected to be $293.84 million, up 17.8% from the year-ago quarter. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. This is essentially a reflection of how the covering analysts have collectively reassessed their initial estimates over this period. Investors should keep in mind that the direction of estimate revisions by each of the covering analysts may not always get reflected in the aggregate change. Price, Consensus and EPS Surprise Estimate revisions ahead of a company's earnings release offer clues to the business conditions for the period whose results are coming out. Our proprietary surprise prediction model -- the Zacks Earnings ESP (Expected Surprise Prediction) -- has this insight at its core. The Zacks Earnings ESP compares the Most Accurate Estimate to the Zacks Consensus Estimate for the quarter; the Most Accurate Estimate is a more recent version of the Zacks Consensus EPS estimate. The idea here is that analysts revising their estimates right before an earnings release have the latest information, which could potentially be more accurate than what they and others contributing to the consensus had predicted earlier. Thus, a positive or negative Earnings ESP reading theoretically indicates the likely deviation of the actual earnings from the consensus estimate. However, the model's predictive power is significant for positive ESP readings only. A positive Earnings ESP is a strong predictor of an earnings beat, particularly when combined with a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold). Our research shows that stocks with this combination produce a positive surprise nearly 70% of the time, and a solid Zacks Rank actually increases the predictive power of Earnings ESP. Please note that a negative Earnings ESP reading is not indicative of an earnings miss. Our research shows that it is difficult to predict an earnings beat with any degree of confidence for stocks with negative Earnings ESP readings and/or Zacks Rank of 4 (Sell) or 5 (Strong Sell). For AppFolio, the Most Accurate Estimate is lower than the Zacks Consensus Estimate, suggesting that analysts have recently become bearish on the company's earnings prospects. This has resulted in an Earnings ESP of -0.71%. On the other hand, the stock currently carries a Zacks Rank of #2. So, this combination makes it difficult to conclusively predict that AppFolio will beat the consensus EPS estimate. While calculating estimates for a company's future earnings, analysts often consider to what extent it has been able to match past consensus estimates. So, it's worth taking a look at the surprise history for gauging its influence on the upcoming number. For the last reported quarter, it was expected that AppFolio would post earnings of $1.67 per share when it actually produced earnings of $1.71, delivering a surprise of +2.40%. Over the last four quarters, the company has beaten consensus EPS estimates three times. An earnings beat or miss may not be the sole basis for a stock moving higher or lower. Many stocks end up losing ground despite an earnings beat due to other factors that disappoint investors. Similarly, unforeseen catalysts help a number of stocks gain despite an earnings miss. That said, betting on stocks that are expected to beat earnings expectations does increase the odds of success. This is why it's worth checking a company's Earnings ESP and Zacks Rank ahead of its quarterly release. Make sure to utilize our Earnings ESP Filter to uncover the best stocks to buy or sell before they've reported. AppFolio doesn't appear a compelling earnings-beat candidate. However, investors should pay attention to other factors too for betting on this stock or staying away from it ahead of its earnings release. Stay on top of upcoming earnings announcements with the Zacks Earnings Calendar. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report AppFolio, Inc. (APPF) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research