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IOT
Earnings call · Jul 2026 (Q2 FY27)

Samsara Q2 FY27 earnings call IOT

Sep 3, 2026 Source

Executive summary

Samsara Q2 FY27 — Strong ARR Growth and AI Feature Adoption

Samsara delivered robust Q2 FY27 results, marked by accelerating ARR growth driven by large customer expansion and strong adoption of new AI-powered products. The company continues to leverage its unique data asset to automate workflows and provide operational insights, positioning it well in the physical AI market. While profitability expanded, free cash flow was impacted by increased inventory and supply chain costs to support accelerated growth.

Highlights

6

  • ARR crossed $2.1 billion, growing 30% year-over-year.

  • Net new ARR was $134 million, an increase of 28% year-over-year in constant currency.

  • $100,000-plus ARR customers grew 38% year-over-year, representing $1.3 billion in ARR.

  • Added a record 242 customers with $100,000 or more in ARR and 20 customers with $1 million or more in ARR.

  • Non-GAAP operating margin was 21% in Q2, up 6 percentage points year-over-year.

  • Customer adoption of latest AI features is up more than 4x in the last 2 months.

Concerns

1

  • Free cash flow margin is expected to be approximately 100 basis points lower than FY26, primarily due to more IoT devices required for stronger growth, proactive inventory purchasing, and elevated supply chain costs.

Guidance & targets

CategoryTargetConfidence
Q3 FY27 Revenue
$514 million and $516 million
high materiality
High
Q3 FY27 Non-GAAP operating margin
21%
medium materiality
High
Q3 FY27 Non-GAAP EPS
$0.18 and $0.19
high materiality
High
Q3 FY27 GAAP profitability
GAAP profitable
medium materiality
High
Full-year FY27 Revenue
$2.043 billion and $2.047 billion
high materiality
High
Full-year FY27 Non-GAAP operating margin
21%
medium materiality
High
Full-year FY27 Non-GAAP EPS
$0.76 and $0.78
high materiality
High
Full-year FY27 GAAP profitability
GAAP profitable
medium materiality
High
Full-year FY27 Free cash flow margin
~100 basis points lower than FY '26
high materiality
Medium

Segment performance

SegmentRevenueYoYQoQMargin
Transportation
Contributed the second highest net new ACV mix in the quarter, with year-over-year growth accelerating sequentially for the third consecutive quarter.
—accelerated sequentially——
Public Sector
Contributed its second highest-ever net new ACV mix, with year-over-year growth accelerating sequentially for the second consecutive quarter, driven by deals with a top 5 U.S. city, MBTA, and the state of Louisiana.
—accelerated sequentially——
Europe
Contributed its second highest-ever net new ACV mix and had its fourth consecutive quarter of 50%+ net new ACV growth, driven by the largest ever Mainland Europe deal with one of the world's largest e-commerce companies.
—50%+ net new ACV growth——
Mexico
Year-over-year net new ACV growth accelerated for the second consecutive quarter, resulting in its highest net new ACV mix in the last 5 quarters.
—accelerated sequentially——

IOT operating KPIs by quarter

IOT operating KPIs stated on its earnings calls, by fiscal quarter
KPI Jan 2026 Q4 FY26 Apr 2026 Q1 FY27This call Jul 2026 Q2 FY27Change vs prior quarter
Annual recurring revenue (ARR)
$1.9B We ended the year with $1.9 billion in ARR, growing 30% year-over-year. Source transcript
—
$2.1B+ In Q2, we crossed $2.1 billion in ARR, growing 30% year-over-year, which is driven by $134 million net new ARR. Source transcript
—
Annual recurring revenue (ARR) $100,000-plus ARR customers
$1.2B We ended the year with $1.2 billion of ARR from our $100,000-plus ARR customers, an increase of 37% year-over-year and our second consecutive quarter of sequential acceleration. Source transcript
$1.2B ARR from $100,000-plus customers was $1.2 billion, increasing 37% year-over-year, resulting in the third consecutive quarter of sequential acceleration. Source transcript
$1.3B Our $100,000-plus customers now represent $1.3 billion in ARR, growing 38% year-over-year. Source transcript
+8.3%
Customers above an annual spend threshold $100,000-plus ARR
3,194 In Q4, we added 204 new $100,000-plus ARR customers and ended FY '26 with 3,194, $100,000-plus ARR customers. Source transcript
3,363 In terms of large customers, we ended Q1 with 3,363 $100,000-plus ARR customers, including a quarterly increase of 169. Source transcript
3,605 In terms of large customers, we ended Q2 with 3,605 $100,000-plus ARR customers, including a quarterly record increase of 242. Source transcript
+7.2%
Customers above an annual spend threshold $1 million-plus ARR—
190 Additionally, we ended Q1 with 190 $1 million-plus ARR customers, a quarterly increase of 15. Source transcript
210 Additionally, we ended Q2 with 210 $1 million plus ARR customers, a quarterly record increase of 20. Source transcript
+10.5%

Operating figures the company states on every call, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Orderbook & backlog

Ending ARR $2.1 billion Q2 FY27

up 30% YoY

Net new ARR $134 million Q2 FY27

up 28% YoY in constant currency

Net new ARR (LTM) $485 million Q2 FY27

up 27% YoY in constant currency

ARR from $100K+ customers $1.3 billion Q2 FY27

up 38% YoY

ARR from $1M+ customers >$500 million Q2 FY27

up >50% YoY

Product announcements

ProductTypeDetails
Tracking Labellaunch
360 Cameralaunch
Waste Intelligencelaunch
Ground Intelligencelaunch
AI Agents for Safety, Maintenance, and Dispatchlaunch
Voice Agents through AI Dashcamlaunch
New AI Multicam Detectionsupdate
Shipment Centerlaunch
Birds Eye Viewlaunch
Samsara Communitylaunch

Deals & partnerships

API Group Large customer win for Samsara's platform.

A global provider of safety, security and specialty services.

Sonepar Large customer win for Samsara's platform.

The world's largest B2B distributor of electrical products.

One of the world's largest e-commerce companies Large customer win and Samsara's largest ever Mainland Europe deal.

This deal contributed to Europe's 50%+ net new ACV growth.

One of the largest cities in the U.S. Expanded partnership from initial vehicle gateways and AI dashcams to a multi-department rollout, connecting assets across the city. >$2 million

Expanded to police, fire, parks, public works, and transit departments, covering a range of vehicles and adding AI multicam, connected asset maintenance, and ground intelligence for pothole detection across 7,600 lane miles.

Leading heavy civil and general contracting company Expanded partnership to include AI dashcams, powered asset gateways, asset tags, AI multicams, and connected forms.

Company runs $1 billion of equipment. Expansion driven by strong pilot results and the need to consolidate fragmented maintenance data onto one platform for improved utilization and maintenance.

MBTA New deal for Samsara's platform.

New England's largest transit provider. Deal included 4 or more products.

State of Louisiana New deal for Samsara's platform.

Deal included 4 or more products.

Risks & headwinds

Free cash flow margin reduction FY27

approximately 100 basis points lower than FY '26

Mitigation:Proactively purchasing more inventory to create a buffer given strong customer demand; long-term unit economics of investments are good; well-capitalized; expect FCF margin to reconverge with operating margins in a more normal supply chain environment.

Elevated supply chain costs second half of the year

increasing

Mitigation:Expects this to be temporary, similar to post-COVID dynamics; exploring levers like higher revenue per device, mix shift to higher-margin products, and cost optimizations to manage gross margin impact over time.

What to watch in Q3 FY27

Free cash flow margin trajectory

next quarter
Current Expected to be ~100 bps lower than FY26
Target Signs of reconvergence with operating margin

Why it matters

Indicates the temporary nature of supply chain impacts and the effectiveness of management's mitigation strategies on profitability.

We now expect free cash flow margin to be approximately 100 basis points lower than FY '26, primarily due to more IoT devices required to support our stronger growth outlook, proactively purchasing more inventory to create a buffer given the strong customer demand we're seeing and elevated supply chain cost in the second half of the year. We believe operating margin is the best indicator of improved profitability and is the best forward indicator of where free cash flow margin will be in a more normal supply chain environment as we've seen in the past.

Q&A highlights

What are the key pillars enabling Samsara to sustain and accelerate revenue and net new ARR growth at an increasing scale?

Sanjit Biswas attributed the acceleration to strong product-market fit with large enterprises undergoing digital transformation. He highlighted the need for information across assets, improved safety and efficiency, and the platform's ability to handle complexity, supported by continuous innovation in new technologies like connected asset maintenance and AI agents.

“I would really point to our customers in the market. We're seeing, especially these large enterprises who have very vast, large complex physical operations look to digitally transform.”

asked by Dylan Becker · answered by Sanjit Biswas

2 min read 6 chapters

Detailed narrative

Large Customer Momentum and Multi-Product Adoption

Samsara continues to see strong momentum with large customers, evidenced by 3,605 customers with $100,000+ ARR and 210 customers with $1 million+ ARR, both quarterly records for additions. These large customers now represent 63% of total ARR, up from 59% a year ago, and are driving accelerated growth. The company's strategy of expanding within existing accounts is successful, with 96% of $100,000+ ARR customers subscribing to two or more products, and 72% to three or more, indicating deep platform adoption.

AI and Product Innovation Driving Usage

The company launched a new wave of AI-powered products at its annual Beyond conference, including the tracking label, 360 camera, Waste Intelligence, Ground Intelligence, and AI agents for various operational tasks. These innovations are seeing rapid adoption, with AI feature usage up more than 4x in the last two months. These products leverage Samsara's vast data asset to provide operational insights and automate workflows, addressing key customer priorities like safety and ROI.

Proprietary Data Asset and Platform Scale

Samsara's platform now processes over 30 trillion data points annually, up more than 40% year-over-year, spanning vehicles, equipment, and frontline workers. This proprietary time-series data, derived from over 105 billion miles driven and 340 million workflows digitized, is a key competitive advantage. The compounding value of this data improves AI models and widens the company's moat, enabling it to address complex physical operations challenges.

Operating Leverage and Consistent Profitability

The company demonstrated improved operating leverage, with non-GAAP operating margin reaching 21% in Q2, a 6 percentage point increase year-over-year. Free cash flow margin was 13%, up 1 percentage point year-over-year, marking the 16th consecutive quarter surpassing the Rule of 40. Samsara also achieved GAAP profitability for the fourth consecutive quarter, with GAAP EPS of $0.03, reflecting efficient growth at scale.

Strategic Inventory and Supply Chain Management

To support accelerating growth and strong customer demand, Samsara is proactively purchasing more IoT device inventory, which is expected to temporarily lower free cash flow margin by approximately 100 basis points compared to FY26. This strategic decision, alongside elevated supply chain costs, is viewed as a temporary impact, with management expecting FCF margin to reconverge with operating margin in a normalized supply chain environment.

Vertical and Geographic Expansion Success

Samsara saw strong performance across various verticals and geographies. Field services was the largest vertical in Q2, contributing its highest net new ACV mix in over two years. The public sector also delivered its second highest-ever net new ACV mix, driven by significant deals with a top 5 U.S. city and other state entities. Internationally, non-U.S. geographies contributed a record 18% of net new ACV, with Europe and Mexico showing accelerated growth and record contributions.

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