TLDR
- Samsara delivered fiscal Q1 2027 earnings per share of $0.17, surpassing analyst expectations of $0.13, while revenue reached $478.8 million versus forecasts of $455.2 million.
- The company’s annual recurring revenue reached the $2 billion milestone, representing a 30% year-over-year increase, while ARR from high-value customers generating over $1 million annually soared 62%.
- Management elevated its full-year fiscal 2027 revenue projection to a range of $2.005–$2.013 billion, exceeding both previous company guidance and Wall Street forecasts.
- Shares declined approximately 3% during premarket hours to $34.18, following the previous session’s close of $35.21.
- RBC Capital increased its price objective to $42 from $41 while reiterating its Outperform rating, though the upgrade failed to prevent the morning selloff.
Samsara (IOT) delivered impressive financial results on Thursday, yet shareholders responded by heading for the exits. The stock retreated to $34.18 during Friday’s premarket session, representing roughly a 3% decline from Thursday’s closing price of $35.21.
The connected operations specialist reported adjusted earnings per share of $0.17 for its first quarter of fiscal 2027, handily exceeding the analyst consensus of $0.13. Top-line performance was equally strong, with revenue hitting $478.8 million — a 31% year-over-year surge that comfortably topped expectations of $455.2 million.
For the first time in company history, annual recurring revenue surpassed the $2 billion threshold, marking a 30% increase from the same period last year. Net new ARR expanded 30% to reach $100.7 million, while the company’s enterprise segment showed particular strength — ARR from customers with annual spending exceeding $1 million skyrocketed 62%, marking the fourth consecutive quarter of acceleration in this critical metric.
Profitability metrics continued their upward trajectory, with adjusted operating margin expanding to 19% compared to 14% in the prior-year period. Management attributed the margin expansion to enhanced operational efficiency across its sales organization, research and development activities, and general administrative functions.
Chief Executive Officer Sanjit Biswas emphasized the company’s achievement of GAAP earnings per share profitability for the third straight quarter. He identified increasing labor shortages among Samsara’s customer base as a significant catalyst driving adoption of the company’s AI-driven automation solutions.
AI Data Center Buildout Is Lifting Demand
Samsara also highlighted the accelerating construction of AI data centers as a positive industry trend. The company noted that substantial infrastructure investments — spanning power generation facilities, cooling systems, and electrical grid enhancements — are channeling capital into the physical industries that comprise its core market, generating sustained demand momentum.
The customer base continued expanding at the high end, with the quarter concluding with 3,363 accounts generating at least $100,000 in ARR and 190 accounts surpassing the $1 million threshold. Management secured 11 new contracts exceeding $1 million in net new annual contract value, representing the company’s second-strongest quarterly performance in this category.
Newer product offerings maintained strong traction, accounting for over 20% of net new annual contract value for the second quarter running.
Guidance Nudged Up, But Not Enough for the Bulls
Looking ahead to the full fiscal 2027 year, Samsara elevated its adjusted EPS forecast to a range of $0.70–$0.72, up from the previous range of $0.65–$0.69 and exceeding the analyst consensus of $0.68. The company also increased its revenue guidance to $2.005–$2.013 billion, compared to its earlier projection of $1.965–$1.975 billion and above Street expectations of $1.971 billion.
For the upcoming second quarter, management projected revenue between $482–$484 million, marginally ahead of Wall Street’s $480 million estimate — a modest beat that failed to generate enthusiasm.
This limited upside cushion appears to be driving the negative market reaction. IOT shares had already climbed approximately 20% following the company’s March earnings report, establishing elevated expectations for continued post-earnings momentum.
RBC Capital adjusted its price target upward to $42 from $41 while maintaining its Outperform rating, a move that reflected optimism tempered with caution.
The stock currently trades significantly below its 52-week peak of $47.47, though it remains well above its 52-week floor of $23.38.
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