TLDR
- SailPoint shares plunged more than 15% during premarket hours Tuesday following first-quarter results
- Q1 revenue reached $280M, surpassing the $275.8M estimate; adjusted earnings per share of $0.05 topped the $0.04 forecast
- Annual recurring revenue increased 26% year-over-year to $1.16B; SaaS ARR surged 36% to $781M
- Full-year revenue outlook modestly increased to $1.265B–$1.275B; EPS projection remained at $0.30–$0.34
- Second-quarter outlook signals decelerating momentum, with ARR growth projected at 24% and revenue expansion at 17–18%
Shares of SailPoint (SAIL) tumbled more than 15% during premarket trading Tuesday, positioning the stock for its steepest single-session decline since March, based on Dow Jones Market Data.
The sharp decline occurred despite the identity security provider exceeding Wall Street projections for both revenue and earnings in its fiscal first quarter that concluded April 30.
Total revenue expanded 22% year-over-year to $280.14M, surpassing analyst projections of $275.8M. Adjusted earnings per share registered at $0.05, marginally above the $0.04 Street estimate.
Subscription revenue powered the quarterly performance, advancing 23% to $266M and representing the lion’s share of total revenue.
Annual recurring revenue expanded 26% year-over-year to $1.16B. SaaS ARR climbed 36% to $781M.
GAAP operating loss totaled -$80M, representing substantial improvement from the -$185M deficit recorded in the comparable period last year. However, the loss widened compared to the -$40M reported in the previous quarter.
CEO Mark McClain characterized the quarter as a “strong start to fiscal 2027,” highlighting what he termed impressive top- and bottom-line performance and solid appetite for identity security solutions.
Second-Quarter Outlook Points to Moderating Momentum
For the second quarter, SailPoint projected total revenue between $308M and $312M, with a midpoint of $310M. This closely aligns with the Street consensus of $309.69M.
Adjusted earnings per share guidance for the second quarter stands at $0.07–$0.08, matching the analyst consensus of $0.08.
Total ARR for the second quarter is anticipated in the $1.218B–$1.222B range, indicating 24% year-over-year expansion — a deceleration from the 26% achieved in Q1.
Revenue growth is also projected to moderate to 17–18% in the second quarter, down from the 22% recorded this period. This slowdown appears to be the primary factor behind investor concern.
Annual Projection Receives Modest Adjustment
SailPoint marginally elevated its full-year fiscal 2027 revenue guidance, now forecasting $1.265B–$1.275B, up from the previous $1.26B–$1.27B range. The midpoint of $1.27B aligns with current consensus estimates.
Full-year adjusted earnings per share guidance remained steady at $0.30–$0.34, with a midpoint of $0.32 — consistent with analyst expectations.
The company anticipates full-year total ARR of $1.364B–$1.374B, signaling 21–22% year-over-year growth.
Adjusted operating margin for the full year is projected at 18.7%–19.3%, with adjusted income from operations estimated between $239M and $244M.
For the second quarter specifically, adjusted operating margin is guided at 18.1%–18.7%, with adjusted income from operations projected at $56.5M–$57.5M.
Futures tracking the Nasdaq indicated approximately 0.8% gains at the time of SAIL’s premarket decline.
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