PROCORE(US:PCOR)2026-02-12 23:02Financial Data and Key Metrics Changes - Total revenue in Q4 was $349 million, up 15.6% year-over-year, with full-year revenue growth of 15% [24][8] - Q4 non-GAAP operating income was $52 million, representing a non-GAAP operating margin of 15%, with a full-year non-GAAP operating margin of 14%, reflecting a year-over-year expansion of 400 basis points [24][8] - Free cash flow for Q4 was $90 million, bringing full-year free cash flow to $215 million, representing 69% year-over-year growth and a 16% free cash flow margin [29][30] Business Line Data and Key Metrics Changes - The U.S. general contractors segment remains a cornerstone of growth, with three new ENR 400 logos added in Q4 and over 70 ENR 400 customers expanding their run rate [8][9] - Procore Pay saw strong momentum, ending the year with nearly 450 customers, representing over 70% year-over-year growth [26] - The total number of $100,000+ ARR customers now exceeds 2,700, with 115 customers spending more than $1 million in ARR, reflecting 34% year-over-year growth [26][27] Market Data and Key Metrics Changes - International revenue grew 14% year-over-year in Q4, impacted by currency headwinds, but grew 15% on a constant currency basis [24] - The owners segment continues to scale, with plans to launch specialized products for portfolio management, planning, funding, and asset management [12] - Data centers currently represent 2% of total U.S. construction activity, with significant growth expected due to AI infrastructure investments [12][13] Company Strategy and Development Direction - The company aims to lead in the AI era, focusing on driving efficiency gains across the construction lifecycle [6][7] - Procore's strategy includes leveraging its position as a system of record and collaboration to enhance AI capabilities, with the recent acquisition of Datagrid to accelerate this strategy [15][66] - The company plans to monetize AI offerings through new bundles and consumption-based models, emphasizing the ROI for customers [73] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in Procore's future, highlighting strong customer relationships and the potential for durable growth and margin expansion [5][22] - The company anticipates revenue growth of 13% for fiscal 2026, with non-GAAP operating margin guidance of 17.5%-18% [32] - Management noted that the construction environment remains challenging, but they are focused on delivering durable growth and improving operational efficiency [30][31] Other Important Information - Procore for Government achieved FedRAMP Moderate authorization, expanding opportunities with U.S. federal and state government customers [12] - The company is focused on limiting share count dilution, with a weighted average diluted share count growth of less than 1% in Q4 [29] Q&A Session Summary Question: Customer Conversations on AI - Management noted that customers are focused on construction and do not have the inclination to become AI experts, preferring that their tech vendor leverage AI effectively [38][39] Question: Trends in Volume Commitments During Q4 Renewal Cycle - Management indicated continued strength in ACV commitments, which have grown beyond $1 trillion, reflecting market share gains [63] Question: Datagrid's Role in AI Strategy - Management explained that Datagrid will help integrate data from various systems, enhancing Procore's AI capabilities and overall platform [66] Question: Monetization Strategy for AI - Management discussed plans to establish compelling ROI for AI offerings, with potential inclusion in new bundles and consumption-based pricing models [73] Question: Capacity and Resource Planning for Go-to-Market - Management confirmed sufficient capacity for fiscal 2026, focusing on productivity increases and resource allocation primarily in R&D [75]