WS Investor
09 Sep 2026, 14:09
SailPoint Stock Slips 0.7% Despite 25% ARR Growth as GAAP Loss Widens
SailPoint (NASDAQ: SAIL) shares fell about 0.7% Wednesday despite reporting strong fiscal second-quarter growth, as a wider GAAP operating loss and expectations for moderating ARR growth offset solid SaaS and AI momentum.
Total annual recurring revenue increased 25% year over year to $1.231 billion, while SaaS ARR jumped 36% to $847 million. SaaS accounted for 97% of net new ARR, highlighting the company’s continued cloud transition.
Second-quarter revenue rose 17% to $309 million, including subscription revenue of $295 million, up 19%. Adjusted operating income increased to $63 million from $54 million, maintaining a 20% adjusted operating margin. However, the GAAP operating loss widened to $59 million from $41 million, with the GAAP operating margin deteriorating to negative 19% from negative 15%.
AI remained a major growth driver. AI-related ARR exceeded $70 million and represented more than 30% of net new ARR during the quarter. Remaining performance obligations also increased 30% to $1.9 billion, while SailPoint generated $37 million in free cash flow.
For fiscal 2027, SailPoint expects ARR of $1.375 billion to $1.385 billion, representing 22% to 23% growth, and revenue of $1.265 billion to $1.275 billion, up 18% to 19%. Adjusted operating income is projected at $239 million to $244 million.
The modest decline suggests investors are balancing strong SaaS and AI adoption against the widening GAAP loss and an outlook that implies some moderation in ARR growth from the 25% pace recorded in Q2.
SailPoint (NASDAQ: SAIL) shares fell about 0.7% Wednesday despite reporting strong fiscal second-quarter growth, as a wider GAAP operating loss and expectations for moderating ARR growth offset solid SaaS and AI momentum.
Total annual recurring revenue increased 25% year over year to $1.231 billion, while SaaS ARR jumped 36% to $847 million. SaaS accounted for 97% of net new ARR, highlighting the company’s continued cloud transition.
Second-quarter revenue rose 17% to $309 million, including subscription revenue of $295 million, up 19%. Adjusted operating income increased to $63 million from $54 million, maintaining a 20% adjusted operating margin. However, the GAAP operating loss widened to $59 million from $41 million, with the GAAP operating margin deteriorating to negative 19% from negative 15%.
AI remained a major growth driver. AI-related ARR exceeded $70 million and represented more than 30% of net new ARR during the quarter. Remaining performance obligations also increased 30% to $1.9 billion, while SailPoint generated $37 million in free cash flow.
For fiscal 2027, SailPoint expects ARR of $1.375 billion to $1.385 billion, representing 22% to 23% growth, and revenue of $1.265 billion to $1.275 billion, up 18% to 19%. Adjusted operating income is projected at $239 million to $244 million.
The modest decline suggests investors are balancing strong SaaS and AI adoption against the widening GAAP loss and an outlook that implies some moderation in ARR growth from the 25% pace recorded in Q2.
