Samsara Inc (IOT) Q1 2026 Earnings Call Highlights: Record Growth and Strategic Partnerships ...
Annual Recurring Revenue (ARR): $1.54 billion, growing 31% year over year.
Revenue: $367 million, growing 31% year over year or 32% adjusted for constant currency.
Customers with $100,000+ ARR: 2,638, growing 35% year over year.
Non-GAAP Gross Margin: 79%, a quarterly record.
Non-GAAP Operating Margin: 14%, compared to 2% in Q1 FY25.
Adjusted Free Cash Flow Margin: 12%, compared to 7% in Q1 last year.
Q2 Revenue Guidance: $371 million to $373 million, representing 24% year-over-year growth.
Full-Year FY26 Revenue Guidance: $1.547 billion to $1.555 billion, representing 24% to 25% year-over-year growth.
Non-GAAP EPS Guidance for Q2: $0.06 to $0.07.
Non-GAAP EPS Guidance for Full-Year FY26: $0.39 to $0.41.
Release Date: June 05, 2025
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Samsara Inc (NYSE:IOT) reported a strong Q1 fiscal 2026 with an ARR of $1.54 billion, marking a 31% year-over-year growth.
The company expanded its customer base significantly, adding 154 customers with more than $100,000 in ARR, a 35% increase year-over-year.
Samsara's AI-powered safety solutions have shown significant impact, with a 75% reduction in safety events and a 71% reduction in mobile usage for a major retail propane company.
The company is expanding its ecosystem through strategic OEM partnerships with Hyundai Translead, Stellantis, and Rivian, enhancing its connected operations platform.
Samsara achieved a record non-GAAP gross margin of 79% in Q1, demonstrating strong operational efficiency and scalability.
Samsara experienced elongated sales cycles due to macroeconomic uncertainties and tariff impacts, affecting some transactions.
Despite strong pipeline generation, there is ongoing macro uncertainty that could create timing risks for deal closures.
The company noted that the current macro environment could delay customer decisions, particularly in asset-intensive industries.
Samsara's international expansion, while promising, still faces challenges in newer markets like France and Germany.
The impact of OEM partnerships on gross margins is not yet significant, and benefits are expected to be realized in the medium to long term.
Q: Can you elaborate on the sales cycle elongation and its impact on deal sizes and pipeline construction? A: Dominic Phillips, CFO, explained that while some deals closed in May, the construction of deals didn't change significantly. The impact was multimillion-dollar, not just hundreds of thousands. Despite macro uncertainty, they had a record pipeline generation in Q1, indicating strong customer demand and interest in Samsara's platform.
Q: How do the OEM investments and relationships impact Samsara's competitive positioning? A: Sanjit Biswas, CEO, stated that OEM partnerships make it easier for customers to integrate their operations into Samsara's Connected Operations Cloud. This strategy reduces friction and enhances data insights, strengthening Samsara's competitive position by simplifying asset digitization for customers.
Q: What are the drivers behind the strong growth in the transportation vertical? A: Sanjit Biswas highlighted that transportation companies prioritize efficiency and safety, leading to increased digitization. Samsara is gaining market share among leading transportation companies, contributing to the vertical's growth as the second largest for the company.
Q: How is Samsara addressing the macroeconomic uncertainty and its impact on customer priorities? A: Dominic Phillips noted that while macro uncertainty creates timing risks for deals, Samsara's strong pipeline and customer demand demonstrate the value of their platform. The company remains focused on delivering ROI and efficiency to customers, which is crucial in uncertain times.
Q: Can you discuss the international growth, particularly in Europe, and any regulatory impacts? A: Sanjit Biswas mentioned that Samsara has been investing in Europe, achieving product-market fit, especially in the UK and Ireland. While there are no specific new regulatory tailwinds, there is growing interest in digital transformation, contributing to international growth.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
This article first appeared on GuruFocus.
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