Core Points - GitLab Inc's shares are down 10% to $43.68 following disappointing second quarter and full-year guidance, despite a first-quarter earnings beat [1] - 14 brokerages have reduced their price targets, with JPMorgan Securities cutting the target from $58 to $52, indicating a bearish sentiment [1] - The stock is experiencing its worst single-session drop since April 3, with a year-to-date deficit of 22% and struggling against the overhead 80-day moving average [2] Analyst Sentiment - Of the 26 brokerages covering GitLab, 23 maintain "buy" or better ratings, with no "sells" reported, suggesting a generally positive outlook despite recent declines [2] - A potential shift in analyst sentiment could negatively impact the stock moving forward [2] Options Activity - There is significant options activity, with over 25,000 call and 16,000 put contracts traded, indicating heightened interest and volatility [3] - The most popular options are the weekly 6/13 40-strike put and the 45-strike call, reflecting traders' strategies in response to the stock's performance [3] Volatility Assessment - GitLab's Schaeffer's Volatility Scorecard (SVS) is 87 out of 100, indicating that the stock has historically exceeded options traders' volatility expectations over the past year [4]

Core Insights - GitLab Inc. reported a revenue of $732.4 million for the quarter ended April 2025, reflecting a year-over-year increase of 332.9% [1] - The earnings per share (EPS) for the quarter was $0.17, up from $0.03 in the same quarter last year, resulting in an EPS surprise of +112.50% against the consensus estimate of $0.08 [1] Revenue Breakdown - Revenue from License-self-managed and other was $20.03 million, slightly below the average estimate of $21.36 million, with a year-over-year change of +11.2% [4] - Subscription revenue from self-managed and SaaS totaled $194.48 million, exceeding the average estimate of $191.15 million, representing a year-over-year increase of +28.6% [4] - Subscription revenue from SaaS was reported at $64.19 million, in line with the two-analyst average estimate of $64.10 million [4] - License revenue from self-managed was $15.03 million, below the two-analyst average estimate of $16.64 million [4] - Subscription revenue from self-managed reached $130.30 million, surpassing the two-analyst average estimate of $127.34 million [4] - Revenue from License-Professional services and other was $5 million, exceeding the average estimate of $4.37 million based on two analysts [4] Stock Performance - GitLab's shares have returned -9.1% over the past month, contrasting with the Zacks S&P 500 composite's +6.9% change [3] - The stock currently holds a Zacks Rank 2 (Buy), suggesting potential for outperformance in the near term [3]

Group 1 - GitLab reported better-than-expected first-quarter results with earnings of 17 cents per share, surpassing the analyst consensus estimate of 15 cents [1][2] - Quarterly revenue reached $214.51 million, exceeding the Street estimate of $213.16 million [1] - For the second quarter, GitLab expects adjusted EPS between 16 and 17 cents and revenue between $226 million and $227 million, both below analyst estimates [2] Group 2 - Following the earnings announcement, GitLab shares fell 0.3% to close at $48.51 [3] - Analysts adjusted their price targets for GitLab, with several maintaining a Buy rating but lowering targets significantly [8] - Price targets were revised down from a range of $52 to $85 to a new range of $55 to $73 by various analysts [8]

Investor Presentation First Quarter Fiscal Year 2026 © GitLab Inc. First quarter fiscal year 2026 results $215M Revenue1 27% Revenue Growth1 12% Q1 FY26 Non-GAAP Operating Margin1 49% Q1 FY26 Non-GAAP Adj. Free Cash Flow Margin1 122% Dollar-Based Net Retention Rate1 10,104 Base Customers1 1,288 $100K ARR Customers1 1 Platform Note: Figures as of the three months ended April 30, 2025 Q1 FY26) unless otherwise noted. 1 Definitions and reconciliations with most directly comparable GAAP figure can be found in t ...

Core Insights - GitLab Inc. reported quarterly earnings of $0.17 per share, exceeding the Zacks Consensus Estimate of $0.08 per share, and showing significant growth from $0.03 per share a year ago, resulting in an earnings surprise of 112.50% [1] - The company posted revenues of $732.4 million for the quarter ended April 2025, which was 2.35% below the Zacks Consensus Estimate, but a substantial increase from $169.19 million year-over-year [2] - GitLab has surpassed consensus EPS estimates in all four of the last quarters and has topped revenue estimates three times during the same period [2] Earnings Outlook - The sustainability of GitLab's stock price movement will largely depend on management's commentary during the earnings call and future earnings expectations [3][4] - The current consensus EPS estimate for the upcoming quarter is $0.15 on revenues of $225.27 million, while for the current fiscal year, the estimate is $0.70 on revenues of $936.51 million [7] Industry Context - The Internet - Software industry, to which GitLab belongs, is currently ranked in the top 22% of over 250 Zacks industries, indicating a favorable outlook for stocks within this sector [8] - Empirical research suggests a strong correlation between near-term stock movements and trends in earnings estimate revisions, which can be tracked using tools like the Zacks Rank [5][6]

User Growth and Customer Base - GitLab has over 50 million registered users, with more than 50% of Fortune 100 companies as customers[127] - Base Customers increased to 10,104 as of April 30, 2025, from 8,976 as of April 30, 2024, representing a 13% increase[134] - Customers with ARR of $100,000 or more rose to 1,288 as of April 30, 2025, up from 1,025 as of April 30, 2024, a 26% increase[145] - The number of customers with ARR over $100,000 increased to 1,288 as of April 30, 2025, up from 1,025 in the same period of 2024[164] Financial Performance - Total revenue increased by $45.3 million, or 27%, to $214.5 million for the three months ended April 30, 2025, compared to $169.2 million for the same period in 2024[163] - Subscription revenue from self-managed and SaaS grew by $43.3 million, or 29%, reaching $194.5 million for the three months ended April 30, 2025[163] - Gross profit for the three months ended April 30, 2025, was $189.5 million, with a gross margin of 88%, down from 89% in the same period of 2024[165] - Net loss attributable to GitLab was $35.9 million for the three months ended April 30, 2025, compared to a net loss of $55.2 million for the same period in 2024[161] Expenses and Investments - Research and development expenses increased by $11.3 million, or 21%, to $65.4 million for the three months ended April 30, 2025[169] - Sales and marketing expenses rose by $15.2 million, or 16%, to $107.6 million for the three months ended April 30, 2025[167] - General and administrative expenses decreased by $6.4 million, or 11%, to $51.1 million for the three months ended April 30, 2025[171] - Stock-based compensation expense increased by $13.6 million, or 32%, to $55.8 million for the three months ended April 30, 2025[173] - GitLab plans to continue investing in research and development, expecting R&D expenses to increase in absolute terms in future periods[133] - Sales and marketing expenses are expected to increase in absolute dollars as GitLab invests in its sales and marketing organization[154] Cash Flow and Liquidity - Cash, cash equivalents, and short-term investments totaled $1.1 billion as of April 30, 2025, compared to $992.4 million as of January 31, 2025, indicating a strong liquidity position[181] - Net cash provided by operating activities was $106.3 million for the three months ended April 30, 2025, a significant increase from $38.1 million in the same period of 2024[183] - Cash used in investing activities was $81.9 million for the three months ended April 30, 2025, primarily for purchases of short-term investments[187] - Adjusted free cash flow for the three months ended April 30, 2025, was $104.1 million, compared to $37.4 million in the same period of 2024[191] Market Strategy and Partnerships - The company employs a "land and expand" strategy, focusing on increasing usage of The DevSecOps platform among existing customers[136] - The company aims to build and maintain successful partnerships and alliances to expand its market reach and drive brand awareness[138] - GitLab's open-core business model allows for community contributions, with nearly 900 contributors making over 3,000 merge requests in 2024[128] Retention and Interest Rates - Dollar-Based Net Retention Rate was 122% as of April 30, 2025, down from 129% in the previous year[136][143] - The Dollar-Based Net Retention Rate was 122% for the three months ended April 30, 2025, down from 129% in the same period of 2024[163] - Interest income decreased by 10% to $10.9 million for the three months ended April 30, 2025, compared to $12.0 million in the same period of 2024, primarily due to lower interest rates[175] - As of April 30, 2025, a hypothetical 1% change in interest rates would result in a fair value change of approximately $5.3 million in the company's investment portfolio[197] Foreign Exchange and Taxation - Foreign exchange losses increased significantly to $9.95 million for the three months ended April 30, 2025, compared to $0.79 million in the same period of 2024, reflecting the revaluation of non-functional currency denominated monetary assets and liabilities[176] - Provision for income taxes decreased by 80.4% to $2.54 million for the three months ended April 30, 2025, down from $12.98 million in the same period of 2024, with an effective tax rate increase of approximately 22.9%[177] - The company has $58.3 million in cash and cash equivalents denominated in currencies other than the U.S. dollar, which may be significantly impacted by fluctuations in foreign currency exchange rates[199]

Financial Data and Key Metrics Changes - First quarter revenue increased by 27% year over year to $215 million, with a non-GAAP operating margin of 12% [7][23] - Non-GAAP gross margin was 90% for the quarter, with non-GAAP operating income of $26.1 million compared to a loss of $3.8 million in the same quarter last year [26][27] - Adjusted free cash flow reached $104.1 million, representing a record adjusted free cash flow margin of 49% [29] Business Line Data and Key Metrics Changes - The number of customers with ARR of at least $5,000 increased to 10,104, contributing over 95% of total ARR [24] - The larger customer cohort with ARR of $100,000 plus increased by 26% year over year, reaching 1,288 [24] - Dollar-based net retention rate (DBNRR) was 122%, driven by seat expansion (80%), increased customer yield (5%), and tier upgrades (15%) [25] Market Data and Key Metrics Changes - Total remaining performance obligations (RPO) grew by 40% year over year to $955.1 million, while current RPO (CRPO) grew by 34% year over year to $584.8 million [25] - SaaS revenue accounted for 30% of total revenue and grew by 35% year over year [26] Company Strategy and Development Direction - The company positions itself as the only AI-native, cloud-agnostic, model-neutral DevSecOps platform, emphasizing its unique capabilities in the software development lifecycle [8][9] - The strategic focus includes enhancing security capabilities and integrating AI throughout the platform to drive maximum ROI for customers [11][12] - The company aims to unlock productivity improvements through human and agent collaboration, with plans to introduce new AI capabilities in the upcoming GitLab 18 launch event [22][32] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate sustainable growth and enhance profitability despite evolving market conditions [23][28] - The outlook for the second quarter expects total revenue of $226 million to $227 million, representing a growth rate of approximately 24% year over year [28] - Management noted that the macroeconomic environment remains cautious, but demand for the platform continues to be strong [108] Other Important Information - The company achieved FedRAMP moderate authorization for its dedicated SaaS solution, which is expected to benefit its public sector business [19] - GitLab Duo's adoption continues to grow, with a 35% increase in customers purchasing GitLab Duo quarter over quarter [16] Q&A Session Summary Question: Customer conversations regarding AI - Management noted that AI is a central topic in customer discussions, with teams looking to leverage AI for productivity and innovation [36] Question: Growth metrics and deal linearity - Management confirmed that the quarter's performance was consistent with expectations, with a mix favoring SaaS and back-end weighted linearity [42][43] Question: Customer additions and pricing changes - Management indicated that while there was a deceleration in new customer additions, the financial impact was minimal, and the focus remains on increasing the volume of new orders [50][51] Question: Impact of AI on developer job growth - Management believes that AI will increase the number of code creators and overall code volume, sustaining demand for developers [58][62] Question: Enhancements with GitLab 18 - Management highlighted significant innovations in GitLab 18, including improved security features and AI capabilities, which will be showcased in the upcoming launch event [100][102]

Financial Data and Key Metrics Changes - First quarter revenue increased by 27% year over year to $215 million, with a non-GAAP operating margin of 12% [5][24] - Non-GAAP gross margin was 90% for the quarter, with non-GAAP operating income of $26.1 million compared to a loss of $3.8 million in the same quarter last year [28][29] - Adjusted free cash flow reached $104.1 million, representing a record adjusted free cash flow margin of 49% [31] Business Line Data and Key Metrics Changes - The SaaS segment accounted for 30% of total revenue, growing 35% year over year [28] - The number of customers with ARR of at least $5,000 reached 10,104, contributing over 95% of total ARR [25] - The dollar-based net retention rate (DBNRR) was 122%, driven by seat expansion (80%), increased customer yield (5%), and tier upgrades (15%) [26][27] Market Data and Key Metrics Changes - Total remaining performance obligations (RPO) grew by 40% year over year to $955.1 million, while current RPO (CRPO) grew by 34% year over year to $584.8 million [27] - The larger customer cohort of $100,000+ in ARR increased by 26% year over year, reaching 1,288 [25] Company Strategy and Development Direction - The company positions itself as the only AI-native, cloud-agnostic, model-neutral DevSecOps platform, emphasizing its unique capabilities in the software development lifecycle [6][7] - GitLab aims to enhance its AI capabilities and integrate them throughout the platform, focusing on security and compliance as key drivers for adoption [10][22] - The company is expanding its market presence through partnerships, such as with AWS, to enhance customer engagement and showcase its solutions [13][22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the company's ability to generate sustainable growth and enhance profitability despite evolving market conditions [24][30] - The outlook for the second quarter expects total revenue of $226 million to $227 million, representing a growth rate of approximately 24% year over year [30] - Management noted that the macroeconomic environment remains cautious, but demand for the platform continues to be strong [104] Other Important Information - GitLab achieved FedRAMP moderate authorization for its dedicated SaaS solution, which is expected to boost its public sector business [19] - The company is on track to launch GitLab Duo Workflow, an AI solution, in the upcoming months [13][33] Q&A Session Summary Question: Customer Conversations on AI - Management noted that AI is a central topic in customer discussions, with teams looking to leverage AI for productivity and innovation [38] Question: Growth Metrics and Deal Linearity - Management confirmed that the quarter's performance was consistent with expectations, with a mix favoring SaaS and back-end weighted linearity [44][45] Question: Customer Additions and Pricing Changes - Management indicated that while there was a deceleration in new customer additions, it did not impact financials significantly [49][51] Question: AI's Impact on Developer Job Growth - Management believes that AI will increase the number of code creators and overall code volume, benefiting GitLab's business model [60][61] Question: Enhancements with GitLab 18 - Management highlighted the focus on creating value through AI integration and enhancing collaboration between humans and agents [68][70]

Core Insights - GitLab reported quarterly earnings of 17 cents per share, exceeding the analyst consensus estimate of 15 cents, with quarterly revenue of $214.51 million, surpassing the Street estimate of $213.16 million [1][2] Financial Performance - For the first quarter of fiscal 2026, GitLab's revenue growth reflects the effectiveness of its AI-native DevSecOps platform, which aims to enhance software delivery for customers [2] - The company anticipates second-quarter adjusted EPS between 16 and 17 cents, slightly above the 16 cent estimate, and revenue between $226 million and $227 million, compared to the $227.16 million analyst estimate [3] Customer Metrics - GitLab reported an increase in customers with more than $5,000 of ARR to 10,104, marking a 13% year-over-year growth [4] - Customers with more than $100,000 of ARR reached 1,288, reflecting a 26% year-over-year increase [4] - The Dollar-Based Net Retention Rate stood at 122% [4] Contractual Obligations - Total Remaining Performance Obligations (RPO) grew 40% year-over-year to $955.1 million, while Current Remaining Performance Obligations (cRPO) increased 34% to $584.8 million [4]

San Francisco (June 10, 2025) -All-Remote-GitLab Inc. (NASDAQ: GTLB), the most comprehensive, intelligent DevSecOps platform, today reported financial results for its first quarter fiscal year of 2026, ended April 30, 2025. "First quarter fiscal year 2026 results underscore the power of our AI-native DevSecOps platform to help customers deliver mission-critical software. We're giving every developer the AI-driven edge they need to innovate faster and more efficiently," said Bill Staples, GitLab chief execut ...