Samsara Surges 12% as Q4 Earnings and Revenues Surpass Estimates

Core Insights - Samsara Inc. (IOT) shares rose by 11.5% after reporting better-than-expected fourth-quarter fiscal 2026 results, with non-GAAP earnings of 18 cents per share, exceeding management's guidance of 12-13 cents and increasing 63.6% year over year [1][7]. Financial Performance - Fourth-quarter revenues reached $444.3 million, surpassing the consensus estimate of $422.1 million and management's guidance of $421-$423 million, marking a 28% increase on a reported basis and 27% on a constant-currency basis [2][7]. - Non-GAAP gross profit increased by 27.2% year over year to $343.2 million, while the gross margin contracted by 100 basis points to 77% [3]. - Non-GAAP operating income was $91.8 million, up from $55.9 million in the same quarter last year, with the non-GAAP operating margin expanding by 500 basis points to 21% [3]. Expense Management - General & administrative (G&A) expenses rose to $40.9 million from $36.7 million year over year, accounting for 9% of quarterly revenues, down from 11% [4]. - Research & development (R&D) expenditures increased to $56.9 million from $48.1 million, representing 13% of fourth-quarter revenues, down from 14% [4]. - Non-GAAP sales & marketing costs were $153.5 million, up from $129 million, constituting 35% of fourth-quarter revenues, lower than 37% in the previous year [5]. Cash Flow and Balance Sheet - As of January 31, 2026, cash and cash equivalents stood at $318.8 million, compared to $275.1 million in the previous quarter [6]. - The company generated operating cash flow of $69.7 million and free cash flow of $62.9 million in the fourth quarter of fiscal 2026 [6]. - For the full fiscal year 2026, operating and free cash flows were $236.2 million and $208.7 million, respectively [6]. Future Guidance - For fiscal 2027, Samsara projects revenues between $1.965 billion and $1.975 billion, with the Zacks Consensus Estimate at $1.91 billion, indicating a year-over-year increase of 19.8% [7][8]. - The anticipated non-GAAP operating margin for fiscal 2027 is 19%, with expected non-GAAP earnings per share in the range of 65-69 cents [7]. - For the first quarter of fiscal 2027, revenues are expected to be between $454-$456 million, with a Zacks Consensus Estimate of $444.8 million, suggesting a year-over-year increase of 21.2% [8].