UBS has revised its price target for GitLab (GTLB, Financial), bringing it down to $73 from the previous $85, while maintaining a Buy rating for the stock. In GitLab's first-quarter results, revenue growth remained strong, though the company recorded its smallest earnings beat to date. Despite robust performance, GitLab chose to reaffirm rather than increase its guidance for fiscal year 2026.
This cautious outlook has sparked concerns regarding potential macroeconomic and AI-related risks that might impact the company. Analysts believe that these factors could weigh on investor sentiment moving forward.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 27 analysts, the average target price for GitLab Inc (GTLB, Financial) is $64.19 with a high estimate of $90.00 and a low estimate of $45.00. The average target implies an upside of 32.33% from the current price of $48.51. More detailed estimate data can be found on the GitLab Inc (GTLB) Forecast page.
Based on the consensus recommendation from 29 brokerage firms, GitLab Inc's (GTLB, Financial) average brokerage recommendation is currently 1.9, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for GitLab Inc (GTLB, Financial) in one year is $96.41, suggesting a upside of 98.74% from the current price of $48.51. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the GitLab Inc (GTLB) Summary page.
GTLB Key Business Developments
Release Date: June 10, 2025
- Revenue: $214.5 million, a 27% increase year-over-year.
- Non-GAAP Operating Margin: 12.2%, compared to negative 2.3% in the previous year.
- Adjusted Free Cash Flow: $104.1 million, with a margin of 49%.
- Non-GAAP Gross Margin: 90% for the quarter.
- Dollar-Based Net Retention Rate (DBNRR): 122%.
- Total Annual Recurring Revenue (ARR): 10,104 customers with ARR of at least $5,000.
- Customers with $100,000+ ARR: Increased 26% year-over-year to 1,288.
- Guidance for Q2 FY26 Revenue: $226 million to $227 million.
- Guidance for FY26 Revenue: $936 million to $942 million.
- Cash and Investments: $1.1 billion at the end of the quarter.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- GitLab Inc (GTLB, Financial) reported a 27% year-over-year increase in revenue, reaching $215 million for the first quarter.
- The company achieved a non-GAAP operating margin of 12%, highlighting significant year-over-year operating margin expansion.
- GitLab Inc (GTLB) continues to see strong adoption of its AI-native DevSecOps platform, with strategic differentiators like cloud agnosticism and comprehensive solutions across the software development lifecycle.
- The company launched GitLab 18, introducing new product capabilities that enhance core DevOps, security, and AI functionalities.
- GitLab Inc (GTLB) achieved FedRAMP Moderate authorization, which is expected to boost its public sector business with its Dedicated offering.
Negative Points
- The company's Q1 beat was described as one of the 'skinniest' since its IPO, indicating tighter performance margins.
- There was a noted deceleration in sequential customer adds, particularly in the $100,000 ARR cohort.
- GitLab Inc (GTLB) experienced a back-end weighted linearity in the quarter, which could indicate potential challenges in deal closures.
- The company faces price sensitivity at the low end of the market, impacting new customer additions.
- Concerns were raised about the potential impact of AI on job growth in the software developer market, which could affect demand for GitLab's services.
