GitLab surges to 52-week high on Q2 beat, guidance raise

GitLab Inc. (NASDAQ: GTLB ) stock surged Wednesday after the company reported strong fiscal second-quarter results.

The software developer also issued upbeat third-quarter guidance and raised its fiscal 2027 outlook.

GitLab reported adjusted earnings of 24 cents per share.

That beat the consensus estimate of 18 cents.

Revenue rose 21% year over year to $286.25 million.

It also topped the Street estimate of $273.12 million.

Adjusted operating income increased to $42.6 million from $39.6 million.

The adjusted operating margin was 15%.

Meanwhile, adjusted free cash flow totaled $9.8 million, representing a 3% margin.

GitLab ended the quarter with $1.3 billion in cash and investments.

It also recorded about $23.3 million in restructuring charges.

The company repurchased about 3.5 million shares during the quarter.

It had roughly $245 million remaining under its buyback authorization.

Bookings And Retention Improve Gross bookings reached a record.

First orders more than doubled to about 1,700, marking the highest level in three years.

New-logo net annual recurring revenue rose 39%.

First-order net ARR climbed nearly 40%, while total net ARR grew 42%.

Deals worth at least $500,000 surged more than 150%.

Ultimate ARR rose about 35% and represented 59% of total ARR.

Gross retention remained above 90%.

Dollar-based net retention improved sequentially to 117% for the first time since 2024.

Total remaining performance obligations rose 16% to $1.2 billion.

Current RPO increased 20% to $744.7 million.

Calculated billings grew 24%, up from 12% growth in the previous quarter.

SaaS And AI Adoption Accelerate SaaS revenue increased 36% and accounted for 34% of total revenue.

GitLab Dedicated and Duo drove the growth.

The company's Flex model secured more than $20 million in commitments from over 130 customers within six weeks.

GitLab expects the model to defer no more than $13 million in fiscal 2027 revenue.

The paid consumption run rate jumped to more than $40 million from $15 million in the first quarter.

GitLab aims to exceed $100 million by year-end.

Duo Agent Platform's paid committed recurring revenue rose 50% sequentially.

Orbit indexing grew 70% to more than 2,200 organizations and generated over 170,000 queries.

Orbit achieved 70% accuracy, compared with 58% for traditional retrieval-augmented generation.

Secure repositories, code pushes and CI/CD pipelines grew 60%, 50% and 40%, respectively.

Meanwhile, GitLab's public-sector business rebounded.

Account executive capacity grew about 30%, while productivity per representative increased roughly 10%.