Q1 2026 Netskope Inc Earnings Call Transcript
Key Points
- Netskope Inc (NTSK) reported a 29% year-over-year increase in Annual Recurring Revenue (ARR), reaching $845 million.
- Revenue grew 28% year-over-year to $202 million, surpassing guidance expectations.
- The company achieved a gross retention rate above the mid-90s, marking the highest in its history.
- Netskope Inc (NTSK) saw a 60% year-over-year growth in ARR from new logos, indicating strong new customer acquisition.
- The company launched several new AI security products, which have generated significant excitement and early pipeline growth.
- Net new ARR was $34 million, a decrease from $39 million in the same quarter last year, indicating a slowdown in ARR growth.
- Operating margin remained negative at 14%, although it showed improvement from the previous year.
- Free cash flow was negative $57 million, reflecting ongoing challenges in cash flow management.
- The net retention rate was 113%, which was lower than some expectations, suggesting potential challenges in upselling to existing customers.
- Despite increased sales and marketing expenses, net new ARR was the lowest in nearly two years, raising concerns about the efficiency of sales investments.
Hello and welcome to Nexco First Quarter 2027 Financial Results Conference Call.
At this time, all participants are in a listen-only mode.
After the speaker's presentation, there will be a question-and-answer session.
To ask the question during the session, you will need to press *11 on your telephone.
You will then hear an automated message advising your hand is raised.
To withdraw your question, please press *11 again.
I would now like to hand the conference over to Michelle Spover.
You may begin.
Good afternoon and thank you for joining us today. With me on the call are Netscope CEO and Co-Founder Sanjay Berry and CFO Drew Delmato. The press release announcing our financial results for the first quarter of fiscal 2027 was issued earlier today and is posted to our Investor Relations website at investors.netscope.com along with the supplemental presentation. Before. Begin, let me remind
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