Samsara outlines 26% FY26 revenue growth target while accelerating AI-driven customer adoption
Sep. 04, 2025 8:55 PM ET
AI-Generated Earnings Calls Insights
Earnings Call Insights: Samsara Inc. (IOT) Q2 2026
Management View- CEO Sanjit Biswas highlighted that Samsara ended Q2 with $1.6 billion in ARR, reflecting 30% year-over-year growth. The company achieved a record by adding 17 customers with over $1 million in ARR, now representing more than 20% of total ARR. "Our $100,000-plus ARR customers now contribute close to $1 billion of ARR, up 35% year-over-year and now represent 59% of our total ARR," said Biswas. He emphasized the company’s strategic focus on large enterprises, citing partnerships with Alaska Airlines, SRM Concrete, and a Fortune 1000 rental equipment company.
- Biswas detailed the launch of several new products at the Samsara Beyond conference, including asset maintenance, commercial navigation, route planning, AI Multicam, and worker safety. He pointed out growing AI adoption among customers and noted a shift toward automation and unified platforms to manage complex operations.
- The company expanded its partner ecosystem to over 350 integrations and appointed Gary Steele to its Board of Directors, with Biswas stating, "His expertise in enterprise software and AI will be invaluable as we continue to drive multiproduct adoption and deliver clear ROI for our customers."
- CFO Dominic Phillips reported, "Q2 was another quarter of durable growth and improved profitability." He cited 19% year-over-year net new ARR growth, a quarterly record in new $1 million-plus ARR customers, and 8% of net new ACV from products launched in the past year. Phillips confirmed, "Q2 revenue was $391 million, growing 30% year-over-year or 31% in constant currency."
Outlook- Phillips provided Q3 guidance with revenue expected between $398 million and $400 million, representing 24% year-over-year growth. Non-GAAP operating margin is projected at 15% and non-GAAP EPS between $0.11 and $0.12.
- For full year FY26, the company expects revenue between $1.574 billion and $1.578 billion, representing 26% year-over-year growth, and non-GAAP EPS between $0.45 and $0.47.
- Management stated, "We believe we are well positioned to deliver durable growth and create long-term shareholder value for a few key reasons," referencing data advantages, AI innovation, and exposure to large operations budgets.
Financial Results- Q2 ending ARR was $1.64 billion, an increase of 30% year-over-year. Net new ARR added was $105 million, up 19% year-over-year.
- Revenue for Q2 was $391 million, up 30% year-over-year. Non-GAAP gross margin reached 78% and non-GAAP operating margin was 15%, both showing year-over-year improvement. Free cash flow margin increased to 11% in Q2, up 7 percentage points year-over-year.
- The company signed 7 net new $1 million-plus ACV transactions and ended Q2 with 147 $1 million-plus ARR customers. International net new ACV comprised 15% of the total, driven mainly by Europe.
- Construction, public sector, and manufacturing were highlighted as strong end markets, with construction contributing the highest net new ACV mix for the eighth consecutive quarter.
Q&A- Aleksandr Zukin, Wolfe Research: Asked about the traction of new product launches and ACV growth from new products. Biswas responded that products like routing, commercial navigation, and asset tags are seeing positive momentum and pilots across industries, with 8% of new ACV from these offerings.
- Zukin followed up on the bounce-back in net new ARR after Q1. Phillips explained, "There were a few larger deals...that we originally had forecasted would come in to Q1, but ultimately pushed to Q2 after the liberation day tariff announcements. All of those larger impacted deals closed in Q2."
- Matthew Hedberg, RBC: Inquired about AI monetization. Biswas indicated that both core and new products are benefiting from AI enhancements and that AI will enable new products and improve existing ones.
- Christopher Quintero, Morgan Stanley: Asked about investments supporting large deals and European expansion. Biswas described company-wide efforts in sales, implementation, and software for large enterprises. Phillips attributed European growth to sustained investment and region-specific product development.
- Michael Turrin, Wells Fargo: Queried about AI infrastructure build-out and public sector traction. Biswas stated, "Construction had the highest contribution to our net new ACV mix for the eighth quarter in a row," and discussed the public sector's focus on operational savings and compliance.
- Analysts repeatedly sought clarity on the basis for large deal momentum, sales productivity, and product portfolio breadth, with management emphasizing strong enterprise traction, balanced sales capacity, and a focus on multiproduct adoption.
Sentiment Analysis- Analyst sentiment was generally positive, with recognition of strong results but questions focused on sustainability, deal timing, and new product ramp. Several expressed interest in how new products and AI will drive future growth and how the company manages complex sales cycles.
- Management’s tone in prepared remarks was confident, with frequent references to records and milestones. During Q&A, management maintained a positive and factual tone, addressing questions directly and acknowledging challenges where relevant. Phillips referenced, "If we don't see those scenarios ultimately play out, it generally results in us being able to outperform the guidance."
- Compared to the previous quarter, both management and analyst sentiment showed increased optimism, with less concern about macro or tariff-related headwinds.
Quarter-over-Quarter Comparison- Guidance for Q3 and FY26 was raised from Q1 expectations, with full-year revenue growth targeted at 26% versus 24% previously. Non-GAAP operating margin guidance increased to 15% for the year, up from 13% in Q1 guidance.
- The company achieved a record 17 new $1 million-plus ARR customers in Q2, compared to 154 additions of $100,000-plus ARR customers in Q1. The share of ARR from $1 million-plus customers grew to over 20%.
- Q2 saw a sequential acceleration in net new ARR growth, attributed in part to the closure of delayed deals from Q1. Management commentary shifted from caution around macro and tariff impact to confidence in customer adaptation and sales execution.
- Analysts in Q2 focused more on product innovation, AI monetization strategies, and enterprise adoption, compared to the previous quarter’s focus on sales cycle elongation and macro uncertainty.
Risks and Concerns- Management acknowledged possible variability in quarterly results due to the timing of large enterprise deals. Phillips stated, "Larger deals have inherently longer and less predictable sales cycles, which means that their timing may introduce more variability into our quarterly results than in the past."
- Tariff-related uncertainty was addressed, with Biswas noting, "At this point, there's still uncertainty on the tariff rates themselves, but tariffs appear to be here to stay. What I'm hearing from customers is they've adapted to the environment."
- The company faces ongoing challenges with customer change management, especially as it introduces more products and expands internationally.
Final Takeaway
Samsara delivered another quarter of strong growth, marked by record new large customers, accelerating adoption of AI-powered products, and improved profitability. Management raised full-year guidance, citing resilience in enterprise demand, successful closure of delayed deals, and positive momentum across key end markets. The company’s focus on multiproduct adoption, AI-driven innovation, and expanding international presence positions it for durable long-term growth, while management remains attentive to risks from large deal variability and evolving macro conditions.
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