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Investing.com - Goldman Sachs has lowered its price target on GitLab Inc (NASDAQ:GTLB) to $48.00 from $50.00 while maintaining a Neutral rating following the company’s second-quarter fiscal 2026 earnings report. According to InvestingPro data, analyst targets for GitLab range from $46 to $76, with the company currently trading at $46.91.
GitLab shares fell approximately 7% in after-hours trading as investors reacted to the company’s reiterated fiscal 2026 guidance, which implies a second-half growth rate of about 20%, down from 28% in the first half, marking a seventh consecutive quarter of dollar-based net expansion rate (DBNER) deceleration. The company maintains impressive gross profit margins of 88.6%, as revealed by InvestingPro data, which offers 8 additional key insights about GitLab’s financial health.
The company reported solid quarterly execution with total revenue of $236 million, approximately 4% above consensus, growing 29% year-over-year and re-accelerating from 27% in the first quarter after five consecutive quarters of deceleration. Current remaining performance obligations (cRPO) grew 31% year-over-year. With a market capitalization of $7.75 billion and a healthy current ratio of 2.48, GitLab maintains strong liquidity positions.
Customer metrics showed healthy trends, with base customers (over $5,000 annual recurring revenue) reaching 10,338, adding 234 net new customers compared to 211 in the previous quarter. Customers with over $100,000 in annual recurring revenue reached 1,344, adding 56 net new customers versus 59 in the previous quarter.
While maintaining its revenue guidance for the fiscal year, GitLab raised its profit outlook, citing its evolving go-to-market strategy under the new Chief Revenue Officer, persistent softness in the small and medium-sized business segment (approximately 8% of mix), and linearity and software-as-a-service mix tailwinds that benefited the second quarter.
In other recent news, GitLab Inc. reported its second-quarter earnings for fiscal year 2026, delivering results that exceeded analysts’ expectations. The company achieved an earnings per share (EPS) of $0.24, surpassing the forecasted $0.16, and generated revenue of $236 million, which was above the projected $226.9 million. GitLab’s subscription revenue growth also accelerated to 30.3% year-over-year, an increase from the previous quarter’s 28.6%. Despite concerns over guidance, BofA Securities maintained its Buy rating on GitLab, with a price target of $72.00. Meanwhile, Wolfe Research adjusted its price target for GitLab to $52.00 from $55.00 but kept an Outperform rating, noting the stock’s current valuation compared to peers. These developments reflect a mixed sentiment from analysts but highlight GitLab’s strong financial performance.
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