Rapid7 (RPD) Stock Forecast & Price Target

Rapid7 has demonstrated steady growth in key areas such as Detection & Response (D&R), which continues to represent over 50% of its Annual Recurring Revenue (ARR), totaling more than $419 million, thereby providing a stable growth base for the company. Additionally, the company’s revenue of $218 million reflects a 1.5% year-over-year increase, indicating stronger demand and successful strategies to accelerate growth in segments beyond vulnerability management, such as Security Information and Event Management (SIEM) and Cloud Security. Positive trends in IT budgets and a robust pipeline of larger deals could further bolster Rapid7's performance, potentially leading to accelerated revenue growth in the coming years.

Rapid7 has experienced a significant negative outlook as evidenced by a ~$20 million reduction in annual recurring revenue (ARR) guidance, which now forecasts 0 net new ARR for the fourth quarter amid recent leadership changes. The company reported an ARR of $837.7 million for the third quarter of 2025, falling short of both prior expectations and a year-over-year growth of only 1.8%, leading to reduced growth and profitability projections. Furthermore, management acknowledged execution challenges and elongated deal cycles that have adversely affected ARR growth, resulting in a downward revision of FY25 revenue guidance and an overall reset of expectations for the company's financial performance.