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    GTLB
    Earnings call· Apr 2026(Q1 FY27)

    Gitlab Q1 FY27 earnings call GTLB

    Jun 2, 2026 Source

    Executive summary

    GitLab Q1 FY27 — Strong Revenue Growth and AI Monetization with Act 2 Restructuring

    GitLab delivered strong Q1 FY27 results, exceeding revenue guidance and expanding non-GAAP operating margin, driven by robust enterprise performance and early success in AI monetization with Duo Agent Platform. The company is undergoing an 'Act 2' restructuring to optimize its operating structure and reallocate resources towards strategic architectural bets, while navigating persistent macro headwinds and customer seat contraction. Management remains focused on long-term durable growth and shareholder value.

    Highlights

    5

    • Revenue of $264 million, up 23% year-over-year, 4 points ahead of guidance.

    • Non-GAAP operating margin of 14%, an increase of 200 basis points year-over-year.

    • Duo Agent Platform contributed more net new ARR in its first quarter than Duo Pro and Duo Enterprise combined in any prior quarter, attached to 4 of the top 10 deals.

    • Current RPO grew 24% year-over-year to $724 million.

    • New logo growth increased 30% year-over-year, achieving the highest absolute first order count in 10 quarters.

    Concerns

    4

    • Price-sensitive cohort, representing approximately 20% of ARR, remained under pressure.

    • More seat contraction than anticipated due to customer layoffs and M&A-related contraction.

    • Expected pre-tax restructuring charges of $30 million to $35 million for FY27, with approximately $19 million in Q2.

    • Potential for near-term disruption associated with organizational changes from the 'Act 2' restructuring.

    Guidance & targets

    9
    CategoryTargetConfidence
    Q2 FY27 Total Revenue
    $272 million to $274 million
    high materiality
    High
    Q2 FY27 Non-GAAP Operating Income
    $30 million to $32 million
    medium materiality
    High
    Q2 FY27 Non-GAAP Net Income Per Share
    $0.17 to $0.18
    medium materiality
    High
    Full Year FY27 Total Revenue
    $1.112 billion to $1.118 billion
    high materiality
    High
    Full Year FY27 Non-GAAP Operating Income
    $135 million to $141 million
    medium materiality
    High
    Full Year FY27 Non-GAAP Net Income Per Share
    $0.79 to $0.82
    medium materiality
    High
    Full Year FY27 Gross Margins
    85% to 87%
    medium materiality
    High
    Q3 FY27 Profitability
    trough
    medium materiality
    High
    Full Year FY27 JiHu Expenses
    approximately $15 million
    low materiality
    High

    Operational metrics

    19
    Non-GAAP Operating Margin
    14%up 200 bps YoY
    Q1 FY27
    Non-GAAP Gross Margin
    88%
    Q1 FY27

    SaaS continues to grow as a share of our revenue mix.

    Free Cash Flow Margin
    56%
    Q1 FY27
    Cash and Investments Balance
    $1.36 billion
    Q1 FY27 end
    Share Repurchased
    2.4 million
    Q1 FY27
    Share Buyback Authorization Remaining
    $350 million
    Q1 FY27 end
    Restructuring Charges (Total)
    $30 million to $35 million
    FY27

    Approximately $19 million expected in Q2, remainder over following 3 quarters.

    Restructuring Charges (Q2 FY27)
    approximately $19 million
    Q2 FY27
    New Logo Growth
    30%YoY
    Q1 FY27

    Versus same period last year.

    First Order Count
    highest absolutein 10 quarters
    Q1 FY27
    SaaS Revenue Growth
    37%YoY
    Q1 FY27

    SaaS is about 1/3 of total revenue.

    Team Members Impacted by Restructuring
    14%
    Q1 FY27

    As of January 31, 2026.

    Geographic Footprint Reduction
    37%
    Q1 FY27
    CI Pipeline Growth
    38%accelerated from mid-20s in late FY26
    April
    Code Pushes (Paid SaaS)
    49%YoY
    Q1 FY27
    Ultimate ARR Share
    57%
    Q1 FY27
    Duo Agent Platform Paid Consumption Run Rate (CRR)
    nearly $20 million
    Q1 FY27

    Includes minimum usage commitments and on-demand credits. First full quarter of consumption.

    Price-Sensitive Cohort ARR Share
    20%
    Q1 FY27

    Remained under pressure.

    GitLab Dedicated ARR
    $70 million
    Q1 FY27

    Crossed another milestone.

    Industry KPIs

    11
    MetricValueDetails
    Revenue growth$264 millionUSD
    Arr net new arr$70 millionUSD
    Rpo current rpoTotal RPO: $1.1 billion; Current RPO: $724 millionUSD
    Bookings billings12%%
    Large customer cohorts1,519 customers (>$100K ARR); 10,831 customers (>$5K ARR)customers
    Large deal new logo metrics30%%
    Gross retention renewal ratewell above 90%%
    Operating FCF margin rule of 40Non-GAAP Operating Margin: 14%; FCF Margin: 56%%
    Ai product adoption monetizationnearly $20 millionUSD
    Net revenue net dollar retention117%%
    Headcount internal ai productivity14% reduction in team members; 40% more code per engineer (Zillow)%

    Orderbook & backlog

    2
    Total RPO$1.1 billionQ1 FY27 end

    18% year-over-year

    Current RPO$724 millionQ1 FY27 end

    24% year-over-year

    Product announcements

    4
    ProductTypeDetails
    GitLab Flexlaunch
    GitLab Orbitlaunch
    New Git Infrastructuremilestone
    Autonomous Engineeringmilestone

    Deals & partnerships

    5
    AWSexpanded relationship

    Expanded relationships with AWS, Google Cloud and Anthropic this quarter.

    Google Cloudexpanded relationship

    Expanded relationships with AWS, Google Cloud and Anthropic this quarter.

    Anthropicexpanded relationship

    Expanded relationships with AWS, Google Cloud and Anthropic this quarter.

    Zillow Groupcustomer contract

    Zillow Group, a long-time GitLab customer, is migrating more than 2,000 engineers to GitLab Dedicated this quarter and piloting GitLab Duo Agent platform.

    CSL Behringcustomer contractmultiyear

    CSL Behring, a global biotech leader and long-time GitLab customer, signed a multiyear commitment to GitLab Ultimate and Duo Agent platform this quarter.

    Risks & headwinds

    6
    Price-sensitive cohort pressurepersistent

    approximately 20% of ARR

    Mitigation: initiatives around increased coverage and faster time to value are underway

    Seat contraction due to customer layoffs and M&AQ1 FY27

    more seat contraction than we anticipated

    Mitigation: Act 2 restructuring to optimize operating structure

    Uncooperative macro backdropFY27

    no meaningful bounce back in FY '27

    Mitigation: prudence embedded in guidance

    Accelerating layoffs in tech sector and heightened customer cautioncurrent

    see accelerating layoffs concentrated in the tech sector

    Mitigation: prudence embedded in guidance

    Near-term disruption from Act 2 organizational changesnear-term

    changes of this scale carry some near-term disruption

    Mitigation: guidance reflects that; careful consideration for business continuity; voluntary separation program undertaken to head off future attrition; protecting sales quota-carrying capacity

    Customer hesitancy on longer-term contractscurrent

    some more uncertainty in the market, which is driving some more customer hesitancy on longer-term contracts

    Mitigation: incentivizing the field to drive greater multiyear contracts, where it makes sense; providing flexibility in contract terms; expanding portfolio with Flex and other monetization vectors

    Q&A highlights

    9

    How is GitLab performing competitively against GitHub, particularly with recent innovation, and are win rates and pricing holding up?

    GitLab sees a strong opportunity, especially with enterprise customers. While migration is slow, Q1 saw a notable increase in enterprises adopting GitLab, leading to a small but meaningful improvement in win rates and 30% higher new logo growth. GitLab is also partnering with an AI lab to rebuild Git infrastructure for 100x scale, anticipating future agentic engineering needs.

    “In Q1, we saw a notable increase in enterprises looking to adopt GitLab as their platform, including new first orders as well as consolidation within our existing base. That did result in a small but meaningful improvement year-over-year against historical win rates.”

    asked by Matthew Hedberg · answered by William Staples

    2 min read6 chapters

    Detailed Narrative

    01

    Act 2 Restructuring and Strategic Reinvestment

    GitLab announced 'Act 2,' a significant restructuring impacting approximately 14% (350) of team members and involving exiting 22 countries. This initiative aims to flatten the organizational structure and reallocate resources. The company expects to incur $30 million to $35 million in pre-tax restructuring charges for FY27, with the majority of savings reinvested into architectural bets, team member investments, and internal AI tooling to accelerate its strategy.

    02

    AI Monetization and Duo Agent Platform (DAP)

    The Duo Agent Platform reached general availability and significantly contributed to net new ARR in its first quarter, outperforming previous Duo Pro and Duo Enterprise combined. DAP is seen as unlocking incremental AI budgets beyond existing DevSecOps spend. GitLab is transitioning Duo Pro and Duo Enterprise subscriptions into DAP, consolidating its AI portfolio onto a consumption business model.

    03

    Consumption Business Model and GitLab Flex

    GitLab is seeing a solid start to its consumption business, with Duo Agent Platform paid consumption run rate (CRR) at nearly $20 million in its first full quarter. The company plans to unveil 'GitLab Flex,' a buying program allowing customers to mix seat-based and credit-based products, reflecting evolving AI workloads and the need for greater flexibility in monetization.

    04

    Architectural Bets for the Agentic Era

    GitLab is pursuing five architectural bets to capitalize on AI structural tailwinds. These include machine scale infrastructure (rebuilding Git for 100x growth), orchestration (connecting agents to business outcomes), context (GitLab Orbit service for improved outcome quality and reduced agentic action cost), governance (identity, audit, policy as core platform services), and a unified platform for all software engineering modes.

    05

    Customer Insights and Market Trends

    Insights from the Executive Advisory Board highlight the need for platform-level governance and control for agents, tool optionality for developers, and 'mission control logic' for managing large code estates. Customers like Zillow Group and CSL Behring are migrating to GitLab Dedicated and adopting Duo Agent Platform to strengthen security, compliance, and scale with AI-driven growth, demonstrating the platform's value in the agentic world.

    06

    Sales Capacity and First Order Growth

    GitLab delivered 30% higher new logo growth year-over-year, achieving its highest absolute first order count in 10 quarters, driven by a dedicated first order team and product-led growth. Investments in quota-carrying headcount from FY26 are expected to benefit gross bookings in the second half of the year, indicating a focus on accelerating new business acquisition.

    AI-generated summary of the company’s earnings call. Not investment advice.