JFrog Ltd

JFrog Ltd. operates in the evolving markets of DevOps, DevSecOps, MLOps, and the emerging DevGovOps, providing a foundational platform for managing and securing the software supply chain in the Artificial Intelligence (AI) era. The company's unified platform aims to provide governance, security, and trust for enterprise software organizations, enabling the unification of development speed, volume, security, governance, and delivery of software applications across hybrid teams of developers, security professionals, AI/Machine Learning (AI/ML) engineers, and AI agents. JFrog envisions a future of "Liquid Software," where innovative, secure, compliant, and trusted software is continuously delivered from any user to any destination. The company serves demanding enterprises, with the majority of the Fortune 500 trusting JFrog as a system of record for their software development ¹.

JFrog's core business model revolves around generating revenue from the sale of multi-tiered subscriptions to its customers. The company employs a dual go-to-market strategy, combining a bottom-up, community-focused approach that drives product usage among software developers, security teams, data scientists, and IT operators, with a top-down motion for full platform adoption focusing on enterprise values for both new and expansion business. Subscriptions are offered for both self-managed deployments and JFrog-managed public cloud deployments, referred to as SaaS subscriptions. The company's pricing model is designed to align value with customer needs as they scale, offering free trials and open-source software options as low-friction entry points to generate demand for its paid offerings ².

The JFrog Platform is built around JFrog Artifactory, which serves as the "single source of truth" for an organization's software artifacts, functioning as an AI Model Registry, Container Registry, and universal binary manager. It supports all major software package technologies and can be deployed across various environments including public clouds, multi-cloud, on-premises, private cloud, and hybrid setups ³. Complementary solutions include JFrog Curation, which acts as a guardian for packages and AI models entering an organization, leveraging the JFrog Catalog of over 4 million unique open-source packages ⁴. JFrog Xray (Security Essentials) continuously scans Artifactory for vulnerabilities, policy violations, and open-source license compliance ⁵. JFrog Advanced Security offers in-depth binary and contextual scanning, including SAST, secrets detection, IaC scanning, container scanning, and malicious machine learning model detection ⁶. JFrog Runtime Security provides insight into runtime environments like Kubernetes clusters for full visibility and traceability ⁷. JFrog Distribution ensures reliable, scalable, and secure software package distribution ⁸. JFrog Connect is a connected device management solution for IoT device fleets ⁹. JFrog ML is an integrated solution for data science and AI/MLOps teams to build, train, secure, and deploy models ¹⁰. JFrog AI Catalog, an extension of Curation, secures, governs, consumes, and deploys AI technologies, including ML models, with a partnership with Hugging Face ¹¹. Finally, JFrog AppTrust provides application risk governance for DevGovOps requirements, managing audit and compliance needs with cryptographically signed evidence ¹².

For the fiscal year ended December 31, 2025, JFrog reported total subscription revenue of $531.8 million ¹³, representing a year-over-year growth rate of 24% ¹⁴. This compares to total subscription revenue of $428.5 million ¹⁵ in 2024 and $349.9 million ¹⁶ in 2023. The gross profit for 2025 was $408.4 million ¹⁷, resulting in a gross margin of 77% ¹⁸, which remained consistent with the 77% ¹⁹ reported in 2024. Operating loss for 2025 was $91.9 million ²⁰, compared to an operating loss of $91.1 million ²¹ in 2024. Net loss for the year was $71.8 million ²², compared to $69.2 million ²³ in 2024. Diluted EPS for 2025 was $(0.62) ²⁴, compared to $(0.63) ²⁵ in 2024. Net cash provided by operating activities was $145.7 million ²⁶, and free cash flow, a non-GAAP measure, was $142.3 million ²⁷. As of December 31, 2025, cash and cash equivalents totaled $75.8 million ²⁸, and short-term investments were $628.6 million ²⁹. Total liabilities were $453.9 million ³⁰.

Comparing 2025 to 2024, total subscription revenue increased by $103.4 million ³¹, with $93.9 million ³² of this growth attributed to existing customers. Revenue from self-managed and SaaS subscriptions grew by $95.9 million ³³ to $502.8 million ³⁴, a 24% ³⁵ increase. License self-managed revenue increased by $7.5 million ³⁶ to $29.0 million ³⁷, a 35% ³⁸ increase. SaaS subscriptions contributed 46% ³⁹ of total revenue in 2025, up from 39% ⁴⁰ in 2024. Revenue from Enterprise Plus subscriptions represented approximately 56% ⁴¹ of total revenue in 2025, an increase from approximately 51% ⁴² in 2024. Cost of revenue increased by $25.2 million ⁴³ to $123.5 million ⁴⁴, a 26% ⁴⁵ increase, primarily due to a $10.6 million ⁴⁶ increase in third-party hosting costs, a $5.9 million ⁴⁷ increase in personnel-related expenses, a $3.8 million ⁴⁸ increase in intangible amortization from the Qwak acquisition, and a $2.2 million ⁴⁹ increase in share-based compensation expense.

During 2025, JFrog continued to expand its platform capabilities, releasing multiple features across DevOps, DevSecOps, DevGovOps, and AI/MLOps. Significant enhancements included agentic security capabilities, AI Catalog, and JFrog AppTrust for DevGovOps and compliance ⁵⁰. The company also introduced new subscription bundles to better align with market needs for application security and AI development ⁵¹. In July 2024, JFrog acquired Qwak AI Ltd., an AI development platform company, to enhance its machine learning model management capabilities ⁵². As of December 31, 2025, JFrog had approximately 6,600 ⁵³ organizations as customers, including approximately 83% ⁵⁴ of Fortune 100 organizations. The number of customers with annual recurring revenue (ARR) of $100,000 or more increased to 1,168 ⁵⁵ from 1,018 ⁵⁶ in 2024, accounting for 77% ⁵⁷ of ARR. Customers with ARR of at least $1.0 million increased to 74 ⁵⁸ from 52 ⁵⁹ in 2024. The net dollar retention rate was 119% ⁶⁰ as of December 31, 2025, up from 116% ⁶¹ as of December 31, 2024.

JFrog intends to extend its technology leadership by continuously investing in new capabilities and expanding its platform to cover a broader range of use cases, including the maturation of security solutions for DevSecOps, the expansion of AI-enabling technologies such as MLOps, and the continued development of DevOps solutions for distribution to the edge. The company also believes that acquiring new technologies will complement its organic innovation efforts, allowing it to adapt rapidly to evolving market needs and deliver increased value to customers ⁶².

A key growth strategy involves expanding within the existing customer base. JFrog has demonstrated a strong ability to retain customers, increase their usage, and cross-sell additional products and features. The net dollar retention rate of 119% ⁶³ as of December 31, 2025, underscores the increasing value of its products to customers. While maintaining its self-service and inbound sales model, JFrog plans to expand its strategic sales team to identify new use cases and drive greater adoption and standardization of its Software Supply Chain Platform among its largest customers ⁶⁴.

JFrog also aims to acquire new customers, leveraging its free trial subscription options and the open-source version of JFrog Artifactory to increase familiarity and facilitate low-friction product adoption. The introduction of AI-powered and MLOps functionality is expected to expose JFrog solutions to new audiences, such as AI/machine learning engineers and data scientists. Additionally, DevGovOps functionality may enable penetration into high-budget departments within legal, compliance, and governance organizations. The company has steadily grown its international presence and plans to continue regional expansion as AI, DevOps, and DevSecOps practices gain wider adoption globally ⁶⁵.

The operational outlook includes a continued increase in research and development expenses, which are expected to rise as JFrog increases its R&D headcount to strengthen and enhance its products and invest in software development ⁶⁶. Sales and marketing expenses are also projected to increase due to additional personnel hires and investments in marketing programs ⁶⁷. General and administrative functions are expected to expand to support overall business growth ⁶⁸. The company anticipates its net dollar retention rate to remain relatively stable, with minor fluctuations around current levels ⁶⁹.

JFrog's planned capital allocation includes continued investment in research and development to drive core technology innovation and bring new products to market ⁷⁰. The company anticipates that its existing cash and cash equivalents and operating cash flow will be sufficient to meet its cash needs for the next 12 months, as well as in the long-term ⁷¹. Future capital requirements will depend on factors such as revenue growth, subscription renewal activity, billing frequency, and the timing and extent of spending on sales, marketing, and R&D efforts, as well as international expansion and capital expenditures for office spaces ⁷².

Management has explicitly flagged several structural headwinds and execution risks. The company's growth rate may decline due to factors such as greater market penetration, increased competition, market consolidation, slowing demand for its platform, failure to capitalize on growth opportunities, business maturation, protracted global disputes, imposition of tariffs and other non-tariff trade barriers, and global economic downturns ⁷³. The markets for JFrog's products are maturing and may evolve more slowly or differently than expected, impacting customer adoption and renewals ⁷⁴. The company's revenue mix is expected to vary over time, potentially harming gross margin and results of operations due to factors like the mix of self-managed and SaaS offerings, entry into new markets, pricing discounts, and increased price competition ⁷⁵. JFrog must also keep pace with rapid technological and competitive developments, as failure to integrate with new technologies could render its products less marketable or obsolete ⁷⁶. The company faces intense competition from in-house solutions, DevOps and developer-focused vendors, cloud providers, and security point solutions, many of whom have greater resources ⁷⁷. Any decline in demand for JFrog Artifactory, which is central to its platform, would negatively impact the business ⁷⁸. The length of sales cycles, particularly for large customers, can be unpredictable, leading to fluctuations in results ⁷⁹. Unfavorable economic conditions, including inflation and recession, may adversely affect enterprise spending and demand for JFrog's products ⁸⁰. The company's inbound sales model may not remain as successful, and its direct sales functions may not fully compensate for a downturn ⁸¹.

Geographic, regulatory, and macro factors also pose constraints. International operations and expansion expose JFrog to risks such as managing a distributed workforce, differing labor regulations, stringent and inconsistent worldwide privacy and data protection laws, unexpected changes in tariffs and trade disputes, currency exchange rate fluctuations (especially NIS against USD), and limitations on reinvesting earnings ⁸². Operations in China are subject to risks related to its economic and political systems, including foreign exchange controls, intellectual property enforcement, extensive government regulation, and data transfer restrictions ⁸³. JFrog is also subject to various governmental export controls, trade sanctions, and import laws, which could impair its ability to compete internationally or lead to liability for violations ⁸⁴. Failure to comply with anti-bribery, anti-corruption, and anti-money laundering laws could result in penalties ⁸⁵. The regulatory environment for AI is uncertain, with new laws like the EU AI Act potentially impacting operations and increasing costs ⁸⁶.

JFrog faces material risks from macroeconomic, competitive, regulatory, geopolitical, and operational factors. Unfavorable economic conditions, including inflationary trends, slower growth or recession, changes to fiscal and monetary policies, tighter credit, higher interest rates, currency fluctuations, and adverse changes to global trade relationships, could negatively impact enterprise spending and demand for JFrog's products ⁸⁷. The market for JFrog's products is highly fragmented, quickly evolving, and subject to rapid technological changes, with competition from in-house solutions, DevOps and developer-focused vendors like Microsoft's GitHub and GitLab, cloud providers such as AWS and Microsoft Azure, and security point solutions like Snyk and Sonatype, many of whom possess greater financial and technical resources ⁸⁸. Regulatory risks include stringent and changing laws related to privacy, data protection, and data security, such as the EU's Data Act and Israel's Privacy Protection Law, 1981, with potential fines under the EU AI Act reaching up to €35 million or 7% of global income ⁸⁹. Geopolitical tensions, including the regional conflict in the Middle East and the war between Russia and Ukraine, could disrupt business operations, impact customers and sales cycles, and affect the global economy ⁹⁰. Operational risks include the potential for defects, security vulnerabilities, errors, or performance failures in the platform, which could lead to revenue loss, liability, and reputational damage ⁹¹. The company's reliance on public cloud providers for infrastructure exposes it to service interruptions and changes in their offerings ⁹². JFrog also faces risks related to its use of open-source software, which could affect its ability to monetize products and protect intellectual property ⁹³.

Management's message to shareholders emphasizes JFrog's goal to provide a system of record for the software supply chain in the AI era, aiming for "Liquid Software" where secure and compliant software is continuously delivered. The company highlights its role as a foundational platform for governance, security, and trust, unifying development speed, volume, security, governance, and delivery across hybrid teams including developers, security professionals, AI/ML engineers, and AI agents ⁹⁴. Management noted that total revenues for the year ended December 31, 2025, were $531.8 million ⁹⁵, representing a year-over-year growth rate of 24% ⁹⁶. They also reported a net loss of $71.8 million ⁹⁷ for the same period. Key strategic priorities for the period ahead include extending technology leadership by investing in new capabilities and expanding the platform for DevSecOps, MLOps, and edge distribution, including potential acquisitions ⁹⁸. Another priority is to expand within the existing customer base, leveraging a net dollar retention rate of 119% ⁹⁹ as of December 31, 2025, and growing the strategic sales team to drive adoption and standardization ¹⁰⁰. Finally, management aims to acquire new customers by utilizing free trials and open-source options, and by expanding internationally, particularly through AI-powered and MLOps functionality to reach new audiences like AI/ML engineers and data scientists, and DevGovOps functionality to penetrate legal, compliance, and governance departments ¹⁰¹.