Samsara (IOT) - 2026 Q2 - Quarterly Results

Executive Summary & Q2 FY2026 Highlights Samsara achieved strong Q2 FY2026 results, with significant ARR and revenue growth, improved profitability, and robust customer acquisition Q2 FY2026 Financial Performance Samsara reported strong financial results for Q2 FY2026, with significant year-over-year growth in key metrics such as Annual Recurring Revenue (ARR) and total revenue, alongside improved profitability on a non-GAAP basis - Samsara ended Q2 FY2026 with $1.6 billion in ARR, marking a 30% increase year-over-year, driven by amplified demand for its Connected Operations Platform in an AI-driven economy[2] Q2 FY2026 Key Financial Highlights (YoY Change) | Metric | Q2 FY2026 | Q2 FY2025 | Y/Y Change | Y/Y Change (Constant Currency) | | :--------------------------------- | :-------- | :-------- | :--------- | :----------------------------- | | Annual Recurring Revenue (ARR) | $1,640.1M | $1,264.0M | 30% | 30% | | Total revenue | $391.5M | $300.2M | 30% | 31% | | GAAP gross profit | $301.0M | $226.8M | $74.2M | - | | GAAP gross margin | 77% | 76% | 1 pt | - | | Non-GAAP gross profit | $305.7M | $230.8M | $74.9M | - | | Non-GAAP gross margin | 78% | 77% | 1 pt | - | | GAAP operating loss | $(26.6)M | $(58.2)M | $31.6M | - | | GAAP operating margin | (7%) | (19%) | 13 pts | - | | Non-GAAP operating income | $59.7M | $17.6M | $42.1M | - | | Non-GAAP operating margin | 15% | 6% | 9 pts | - | | GAAP net loss per share, basic and diluted | $(0.03) | $(0.09) | $0.06 | - | | Non-GAAP net income per share, basic and diluted | $0.12 | $0.05 | $0.07 | - | | Net cash provided by operating activities | $50.2M | $18.1M | $32.1M | - | | Net cash provided by operating activities margin | 13% | 6% | 7 pts | - | | Adjusted free cash flow | $44.2M | $13.1M | $31.1M | - | | Adjusted free cash flow margin | 11% | 4% | 7 pts | - | Key Operational Metrics Samsara demonstrated strong customer acquisition and expansion, particularly among larger customers, contributing significantly to its Annual Recurring Revenue (ARR) growth - The number of customers with ARR over $100,000 increased to 2,771, up from 2,120 a year ago, indicating strong growth in larger customer segments[4] - Customers with ARR over $100,000 generated approximately $1 billion of ARR, representing 35% year-over-year growth[4] - Customers with ARR over $1,000,000 contributed more than 20% of the total ARR[4] Financial Outlook Samsara forecasts continued revenue growth and improved non-GAAP operating margins and diluted EPS for Q3 and full fiscal year 2026 Q3 FY2026 and FY2026 Guidance Samsara provided optimistic financial guidance for Q3 FY2026 and the full fiscal year 2026, projecting continued revenue growth and improved non-GAAP operating margins and diluted net income per share Financial Outlook for Q3 FY2026, Implied Q4 FY2026, and FY2026 | Metric | Q3 FY2026 Outlook | Implied Q4 FY2026 Outlook | FY 2026 Outlook | | :--------------------------------- | :---------------- | :------------------------ | :-------------- | | Total revenue | $398M – $400M | $418M – $420M | $1.574B – $1.578B | | Year/Year revenue growth | 24% | 21% | 26% | | Year/Year revenue growth in constant currency | 23% – 24% | 20% | 26% | | Non-GAAP operating margin | 15% | 15.5% | 15% | | Non-GAAP net income per share, diluted | $0.11 – $0.12 | $0.11 – $0.12 | $0.45 – $0.47 | - Constant currency impact to revenue guidance is expected to be a $1 million positive impact for Q3 FY26, a $3 million positive impact for Q4 FY26, and a $0 million positive impact for FY26[6] Company Overview Samsara's Connected Operations Platform improves safety, efficiency, and sustainability by connecting operations across diverse industries About Samsara Samsara is a pioneer of the Connected Operations Platform, an open platform designed to connect people, devices, and systems in complex operations to generate actionable insights and improve safety, efficiency, and sustainability across various industries - Samsara's Connected Operations Platform connects people, devices, and systems to provide actionable insights and improve operations[7] - The company serves tens of thousands of customers across North America and Europe in industries such as transportation, construction, logistics, manufacturing, and utilities[7] - Samsara's mission is to increase the safety, efficiency, and sustainability of the operations that power the global economy[7] Important Disclosures This section details forward-looking statements, non-GAAP financial measures, and definitions for key operating metrics and financial terms Forward-Looking Statements This section outlines the nature of forward-looking statements within the press release, emphasizing that they are subject to inherent risks and uncertainties that could cause actual results to differ materially from expectations, and the company does not undertake to update them - Forward-looking statements relate to future operating results, financial performance, market opportunity, industry trends, macroeconomic conditions, customer adoption, product development, and competitive position[8] - These statements are subject to risks and uncertainties, including customer retention, ability to attract new customers, future financial performance, global economic and geopolitical events, supply chain challenges, foreign currency fluctuations, and technological changes[11] - The company does not undertake any obligation to publicly update or revise any forward-looking statement, except as required by law[12] Use of Non-GAAP Financial Measures Samsara utilizes non-GAAP financial measures to provide investors with additional insights into its operating results, aligning with management's perspective, while also acknowledging the inherent limitations of these measures compared to GAAP - Non-GAAP financial measures are presented to assist investors in evaluating Samsara's operating results through management's eyes and provide an additional tool for business evaluation[15] - These measures have limitations as analytical tools and should not be considered in isolation or as substitutes for GAAP financial information, as other companies may calculate them differently[14] - Expenses excluded from non-GAAP performance measures include stock-based compensation expense-related charges (amortization of deferred stock-based compensation and employer taxes on employee equity transactions), lease modification, impairment, and related charges, and legal settlements[16][17] Operating Metrics and Non-GAAP Financial Measures Definitions This section provides clear definitions for key operating metrics and non-GAAP financial measures used by Samsara, including ARR, constant currency adjustments, customer criteria, and various non-GAAP profit and cash flow metrics - Annual Recurring Revenue (ARR) is defined as the annualized value of subscription contracts that have commenced revenue recognition as of the measurement date[18] - Constant currency methodology assesses underlying business performance by excluding foreign currency rate fluctuations, converting current period results using comparative period exchange rates[19] - A 'customer' is an entity or affiliated group with ARR greater than $1,000 at the end of a reporting period[20] - Non-GAAP Gross Profit, Operating Income (Loss), and Net Income (Loss) exclude stock-based compensation expense-related charges, lease modification/impairment charges, and legal settlements to provide a clearer view of ongoing operational performance[21][22][23] - Free Cash Flow is net cash from operating activities minus purchases of property and equipment, while Adjusted Free Cash Flow further excludes non-recurring capital expenditures and legal settlements, both used to evaluate liquidity and funding ability[24][25] Condensed Consolidated Financial Statements This section presents Samsara's condensed consolidated financial statements, highlighting growth and improved operational efficiency Condensed Consolidated Balance Sheets Samsara's balance sheet as of August 2, 2025, shows an increase in total assets and stockholders' equity compared to February 1, 2025, reflecting growth in cash, investments, and deferred revenue Condensed Consolidated Balance Sheet Highlights (in thousands) | Metric | As of August 2, 2025 | As of February 1, 2025 | | :--------------------------------- | :------------------- | :--------------------- | | Total current assets | $1,185,950 | $1,145,154 | | Total assets | $2,207,099 | $2,024,302 | | Total current liabilities | $791,586 | $761,346 | | Total liabilities | $992,326 | $955,106 | | Total stockholders' equity | $1,214,773 | $1,069,196 | - Cash and cash equivalents increased from $227,576 thousand to $258,472 thousand, and long-term investments grew from $282,652 thousand to $386,266 thousand[28] - Deferred revenue (current and non-current) increased from $685,770 thousand to $740,512 thousand, indicating strong future revenue recognition[28] Condensed Consolidated Statements of Operations and Comprehensive Loss Samsara's income statement for Q2 FY2026 shows substantial revenue growth and improved operating loss and net loss compared to the prior year, reflecting increased gross profit and controlled operating expenses relative to revenue growth Condensed Consolidated Statements of Operations Highlights (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | Revenue | $391,480 | $300,202 | $758,364 | $580,928 | | Gross profit | $300,979 | $226,837 | $584,694 | $438,938 | | Loss from operations | $(26,619) | $(58,194) | $(59,874) | $(124,191) | | Net loss | $(16,800) | $(49,610) | $(38,921) | $(105,899) | | Net loss per share, basic and diluted | $(0.03) | $(0.09) | $(0.07) | $(0.19) | - Revenue grew 30% year-over-year for the three months ended August 2, 2025, reaching $391,480 thousand[31] - Loss from operations significantly narrowed from $(58,194) thousand in Q2 FY2025 to $(26,619) thousand in Q2 FY2026[31] Condensed Consolidated Statements of Cash Flows Samsara's cash flow statement indicates a substantial increase in net cash provided by operating activities for both the three and six months ended August 2, 2025, demonstrating improved operational efficiency and cash generation Condensed Consolidated Statements of Cash Flows Highlights (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | Net cash provided by operating activities | $50,161 | $18,117 | $102,773 | $41,787 | | Net cash used in investing activities | $(68,156) | $(36,289) | $(86,445) | $(33,238) | | Net cash provided by financing activities | $18,399 | $15,667 | $18,043 | $15,979 | | Net increase (decrease) in cash, cash equivalents, and restricted cash | $623 | $(2,965) | $35,715 | $23,965 | - Net cash provided by operating activities more than doubled year-over-year for the three months ended August 2, 2025, reaching $50,161 thousand[34] - Cash, cash equivalents, and restricted cash at the end of the period increased to $281,509 thousand from $178,703 thousand a year prior[34] Reconciliation Between GAAP and Non-GAAP Financial Measures This section reconciles GAAP and non-GAAP financial measures for key metrics, detailing the impact of various adjustments Revenue and Revenue Growth Reconciliation Samsara's revenue and revenue growth reconciliation highlights the impact of constant currency adjustments, showing a slightly higher growth rate when foreign exchange fluctuations are excluded Revenue and Revenue Growth Reconciliation (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | GAAP revenue | $391,480 | $300,202 | $758,364 | $580,928 | | Constant currency adjustment | $316 | — | $3,882 | — | | Revenue adjusted for constant currency | $391,796 | $300,202 | $762,246 | $580,928 | | GAAP revenue growth | 30% | 37% | 31% | 37% | | Revenue growth in constant currency | 31% | 37% | 31% | 37% | - For Q2 FY2026, GAAP revenue growth was 30%, while revenue growth in constant currency was 31%, indicating a minor positive impact from foreign currency rates[37] Gross Profit and Gross Margin Reconciliation The reconciliation shows that non-GAAP gross profit and margin are consistently higher than GAAP figures due to the exclusion of stock-based compensation expense-related charges, reflecting the company's core operational profitability Gross Profit and Gross Margin Reconciliation (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | GAAP gross profit | $300,979 | $226,837 | $584,694 | $438,938 | | Stock-based compensation expense-related charges | $4,713 | $3,939 | $9,074 | $7,705 | | Non-GAAP gross profit | $305,692 | $230,776 | $593,768 | $446,643 | | GAAP gross margin | 77% | 76% | 77% | 76% | | Non-GAAP gross margin | 78% | 77% | 78% | 77% | - Non-GAAP gross margin for Q2 FY2026 was 78%, one percentage point higher than the GAAP gross margin of 77%[37] Operating Income (Loss) and Operating Margin Reconciliation The reconciliation demonstrates a significant improvement in operating profitability on a non-GAAP basis, moving from a substantial GAAP operating loss to a positive non-GAAP operating income, primarily by excluding stock-based compensation Operating Income (Loss) and Operating Margin Reconciliation (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | GAAP loss from operations | $(26,619) | $(58,194) | $(59,874) | $(124,191) | | Stock-based compensation expense-related charges | $86,317 | $75,746 | $170,643 | $147,902 | | Non-GAAP operating income | $59,698 | $17,552 | $110,769 | $23,711 | | GAAP operating margin | (7%) | (19%) | (8%) | (21%) | | Non-GAAP operating margin | 15% | 6% | 15% | 4% | - Non-GAAP operating income for Q2 FY2026 was $59,698 thousand, a substantial increase from $17,552 thousand in Q2 FY2025, resulting in a non-GAAP operating margin of 15% (up 9 percentage points YoY)[37] Net Income (Loss) and Net Income (Loss) per Share Reconciliation The reconciliation highlights the significant impact of non-GAAP adjustments, particularly stock-based compensation, in transforming a GAAP net loss into a positive non-GAAP net income and diluted EPS, reflecting underlying operational profitability Net Income (Loss) Reconciliation (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | GAAP net loss | $(16,800) | $(49,610) | $(38,921) | $(105,899) | | Stock-based compensation expense-related charges | $86,317 | $75,746 | $170,643 | $147,902 | | Non-GAAP net income | $69,517 | $26,136 | $131,722 | $42,003 | Net Income (Loss) per Share Reconciliation | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | GAAP net loss per share, diluted | $(0.03) | $(0.09) | $(0.07) | $(0.19) | | Total impact on net loss per share, diluted, from non-GAAP adjustments | $0.15 | $0.14 | $0.30 | $0.26 | | Non-GAAP net income per share, diluted | $0.12 | $0.05 | $0.23 | $0.07 | - Non-GAAP net income per share, diluted, increased to $0.12 in Q2 FY2026 from $0.05 in Q2 FY2025[40] Free Cash Flow and Adjusted Free Cash Flow Reconciliation Samsara's free cash flow and adjusted free cash flow significantly improved year-over-year, demonstrating enhanced liquidity and ability to fund future operations and strategic initiatives Free Cash Flow and Adjusted Free Cash Flow Reconciliation (in thousands) | Metric | Three Months Ended August 2, 2025 | Three Months Ended August 3, 2024 | Six Months Ended August 2, 2025 | Six Months Ended August 3, 2024 | | :--------------------------------- | :-------------------------------- | :-------------------------------- | :------------------------------ | :------------------------------ | | Net cash provided by operating activities | $50,161 | $18,117 | $102,773 | $41,787 | | Purchases of property and equipment | $(5,969) | $(4,992) | $(12,889) | $(10,054) | | Free cash flow | $44,192 | $13,125 | $89,884 | $31,733 | | Adjusted free cash flow | $44,192 | $13,125 | $89,884 | $31,733 | | Net cash provided by operating activities margin | 13% | 6% | 14% | 7% | | Free cash flow margin | 11% | 4% | 12% | 5% | | Adjusted free cash flow margin | 11% | 4% | 12% | 5% | - Free cash flow for Q2 FY2026 was $44,192 thousand, a substantial increase from $13,125 thousand in Q2 FY2025, with free cash flow margin improving from 4% to 11%[43] - Stock-based compensation expense-related charges totaled $86,317 thousand for the three months ended August 2, 2025, including amortization of capitalized software and employer taxes on employee equity transactions[43]