SentinelOne(US:S) ZACKS·2025-12-05 19:21Core Insights - SentinelOne reported third-quarter fiscal 2026 earnings of 7 cents per share, exceeding the Zacks Consensus Estimate by 40% and improving from break-even results in the same quarter last year [1][9] - Revenues reached $258.9 million, reflecting a 23% year-over-year increase and surpassing the consensus mark by 1.14% [1][9] - Annualized recurring revenues (ARR) grew 23% year over year to $1.06 billion, with customers generating over $100,000 in ARR increasing by 20% to 1,572 [2] Financial Performance - Adjusted gross profit for the reported quarter was 78.5%, a contraction of approximately 90 basis points year over year [3] - Total operating expenses were $185.6 million, up 4.1% year over year, driven by a 21.4% increase in research and development expenses, while sales and marketing expenses decreased by 1.9% and general and administrative expenses decreased by 2.3% [3] - Non-GAAP operating income was $17.7 million, compared to a non-GAAP loss of $10.7 million in the year-ago quarter [4] Balance Sheet and Cash Flow - As of October 31, 2025, SentinelOne had cash, cash equivalents, and investments totaling $873.6 million [5] - Free cash flow was $15.9 million, a significant improvement from the free cash burn of $12.7 million reported in the same quarter last year [5] Future Guidance - For the fourth quarter of fiscal 2026, SentinelOne expects revenues of $271 million, indicating a year-over-year growth of 20.2% [6] - The company anticipates a non-GAAP gross margin of 77.5% and an adjusted operating margin of 5%, suggesting a year-over-year improvement of 400 basis points [6] - For fiscal 2026, revenues are projected to reach $1 billion, with an expected adjusted gross margin of 78.5% [6][7] Market Performance - SentinelOne's shares declined by 11.62% at the time of the report and have fallen 34.1% over the past year, contrasting with a 25.1% rise in the Zacks Computer & Technology sector [2]