GitLab Q1 Revenue Jumps on AI Demand

Core Insights - GitLab Inc. reported a 27% year-over-year revenue growth to $214.5 million for Q1 FY2026, with a non-GAAP operating margin of 12% [1] - The company reaffirmed its guidance for approximately 24% top-line growth for FY2026, indicating strong market expansion opportunities [1] AI-Driven Product Adoption - GitLab Duo's first-time customer acquisition increased by 35% quarter-over-quarter, with significant wins including Highmark Health, the FBI, NatWest, and Volkswagen Digital Solutions [2][3] - 52% of total Annual Recurring Revenue (ARR) now comes from customers using the Ultimate tier, reflecting a growing demand for advanced security and AI features [2] Financial Performance - The company achieved a record adjusted free cash flow of $104.1 million, with a free cash flow margin of 49%, and a non-GAAP operating income of $26.1 million, compared to a loss of $3.8 million in the same period last year [4][5] - SaaS revenue, now constituting 30% of total revenue, increased by 35% year-over-year, driven by strong adoption of GitLab Dedicated [4] Strategic AI Platform Expansion - GitLab Duo's integration with Amazon Q and the expansion of agentic AI features have been pivotal, with AI-assisted test generation accelerating by over 35% during evaluations [6][7] - The company is focused on ongoing investment in native AI workflows and ecosystem interoperability to maintain relevance in evolving development environments [7] Future Outlook - Management guided Q2 FY2026 total revenue to be between $226 million and $227 million, and full-year FY2026 revenue to be between $936 million and $942 million, both implying a 24% year-over-year growth [8] - GitLab is set to publicly launch Duo Workflow (agentic AI) this winter and will provide further product innovation details at the GitLab 18 launch event on June 24 [9]