SentinelOne Q2 Earnings Beat as Platform Growth Drives Outlook Raise

SentinelOne S reported second-quarter fiscal 2027 earnings of 8 cents per share, up 100% year over year and 14.29% above the Zacks Consensus Estimate. 

Revenues of $291.98 million rose 20.6% and topped the consensus mark by 0.67%. The quarter benefited from broader Singularity platform adoption, upmarket wins and operating leverage. Remaining performance obligations (RPO) rose 45% to a record $1.7 billion, while management raised its fiscal 2027 revenue and operating income outlooks.

S Builds ARR & Large-Customer Momentum

Annualized recurring revenues (ARR), increased 22% year over year to $1.218 billion. Net new ARR reached a record second-quarter $56 million, up 4% from the prior-year period. Customers generating at least $100,000 in ARR increased 13% to 1,715.

ARR per customer reached a company record as SentinelOne continued to move upmarket. For customers with at least $100,000 in ARR, dollar-based net retention improved year over year and sequentially for the third consecutive quarter, reflecting stronger multiproduct adoption and contributions from AI products.

SentinelOne, Inc. Price, Consensus and EPS Surprise

SentinelOne, Inc. price-consensus-eps-surprise-chart | SentinelOne, Inc. Quote

SentinelOne Broadens Platform Adoption

More than 50% of total ARR comes from non-endpoint solutions, including Data, artificial intelligence (AI) and Cloud. SentinelOne Flex, which gives customers a streamlined way to adopt and expand across the Singularity platform, exceeded 10% of total ARR within a year of launch.

Management cited stronger competitive win rates, larger strategic commitments and consistent seven and eight-figure customer wins. Contract duration increased, while sales cycles compressed, supporting the company’s effort to deepen platform consolidation among large enterprises.

SentinelOne's AI & Cloud Products Accelerate

SentinelOne continued to see strong momentum across its AI, Data and Cloud offerings in the second quarter of fiscal 2027. ARR from Prompt Security and Purple AI nearly tripled year over year, while Prompt Security remained the company’s fastest-growing platform solution. Data solutions recorded a fifth consecutive quarter of ARR growth acceleration, while Cloud security marked its third straight quarter of acceleration. 

Customer wins reflected demand across these emerging products. Bell Canada selected Prompt Security for real-time visibility, automated guardrails and compliance capabilities. A global services firm chose SentinelOne’s AI SIEM over legacy and next-generation alternatives, gaining petabyte-scale telemetry control and a foundation for AI-driven automation. Meanwhile, a major U.S. technology company expanded its deployment with Singularity Cloud, citing platform performance and operational ease of use.

S Improves Profitability & Cost Efficiency

Non-GAAP gross margin contracted 200 basis points year over year to 77%.

Non-GAAP research and development expense increased 22.2% year over year to $65.88 million, while sales and marketing expense declined 5.7% year over year to $97.88 million. General and administrative expense rose 8.3% year over year to $30.76 million.

Non-GAAP operating income increased to $30.53 million from $5.38 million. Operating margin expanded 820 bps to 10%.

SentinelOne’s Balance Sheet Remains Strong

As of July 31, 2026, SentinelOne had cash, cash equivalents and short-term investments of $813 million compared with $812 million as of April 30, 2026. The company had no debt.

Net cash used in operating activities was $6.5 million in the second quarter of fiscal 2027 compared with operating cash flow of $38.5 million in the previous quarter.

Adjusted free cash outflow widened to $13.24 million from $7.15 million in the prior-year quarter, with the free cash flow margin declining to negative 5% from negative 3%.

SentinelOne Raises Fiscal 2027 Outlook

For the third quarter of fiscal 2027, SentinelOne expects revenues to be in the range of $309-$311 million. Non-GAAP operating income is projected between $38 million and $40 million, with non-GAAP earnings of 8-9 cents per share.

For fiscal 2027, revenues are expected between $1.202 billion and $1.207 billion, representing 20% growth at the midpoint. Non-GAAP operating income is forecast at $124-$128 million, while non-GAAP earnings are projected at 30-32 cents per share.

SentinelOne’s Zacks Rank & Stocks to Consider

Currently, SentinelOne carries a Zacks Rank #3 (Hold).
 
NVIDIA NVDA, KLA KLAC and Vertiv VRT are stocks worth considering in the broader Zacks Computer and Technology sector, all of which carry a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
 
The long-term earnings growth rates for NVIDIA, KLA and Synopsys are pegged at 104.76%, 15.74% and 74.61%, respectively.
 
Shares of NVIDIA, KLA and Vertiv have appreciated 22.2%, 51.2% and 66.2% year to date, respectively.

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