Q2 2027 Sprinklr, Inc. Earnings Call Transcript
Key Points
- Sprinklr Inc (CXM) delivered solid Q2 FY2027 results with total revenue of $213.7 million and subscription revenue growth of 3% year-over-year, alongside a 15% non-GAAP operating margin.
- The company saw significant momentum in key metrics, including NAR growth of over 50% year-over-year, a 30% increase in completed sales transactions, and four $1 million-plus ARR deals closed during the quarter.
- Sprinklr Inc (CXM) was recognized as a leader in the 2026 Gartner Magic Quadrant for Social Media Management and Listening, validating its strategic vision and innovation leadership.
- The company's AI-native platform is gaining traction with over 200 AI engagements underway, and ARR for AI-native SKUs grew 40% year-over-year, positioning Sprinklr Inc (CXM) for future growth.
- Sprinklr Inc (CXM) reported strong balance sheet and cash flow, with $453 million in cash, no debt, and $79 million in free cash flow generated in the first half of fiscal year 2027.
- Total RPO reached $1.03 billion, up 11% year-over-year, marking the second consecutive quarter of double-digit growth and providing increased visibility into future revenue.
- Sprinklr Inc (CXM) experienced a significant decline in professional services revenue, which was lower than anticipated due to softness in managed services and execution challenges, leading to a negative 22% services gross margin.
- The company's total revenue growth was only 1% year-over-year, with subscription revenue growth of just 3%, indicating a slow pace of expansion.
- Sprinklr Inc (CXM) faces ongoing headwinds from higher data and hosting costs related to AI capabilities, which are pressuring margins and profitability.
- The company's Q3 FY2027 revenue guidance is slightly down year-over-year due to a significant reduction in professional services revenue, reflecting a structural shift that may impact near-term growth.
- Sprinklr Inc (CXM) lowered its full-year free cash flow margin outlook to approximately 16% due to lower services billings and higher cash outflows for new hosting environments.
- The company is still in the transition phase of its transformation, with management acknowledging that more work is needed to achieve durable long-term growth and enter the acceleration phase in fiscal year 2028.
Greetings. Welcome to Sprinklr's second quarter fiscal year 2027 call. (Operator Instructions) Please note, this conference is being recorded.
I'll now turn the conference over to Eric Scro, Head of Investor Relations. Thank you. You may begin.
Thank you, operator, and welcome, everyone, to Sprinklr's second quarter fiscal year 2027 financial results call. Joining us today are Rory Read, Sprinklr's President and CEO; and Anthony Coletta, Sprinklr's Chief Financial Officer. We issued our earnings release a short time ago, filed the related Form 8-K with the SEC, and we've made them available on the Investor Relations section of our website, along with the supplementary investor presentation.
Please note that on today's call, management will refer to certain non-GAAP financial measures. While the company believes these non-GAAP financial measures provide useful information for investors, the presentation of this information is not intended to be considered in
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