Sprinklr, Inc.

Q2 total revenue was $213.7 million, up 1% year over year. Subscription revenue was $194.8 million, up 3% year over year, and professional services revenue was $18.9 million. Non-GAAP gross margin was 66%, including 74% non-GAAP subscription gross margin and negative 22% services gross margin. Non-GAAP operating income was $31.3 million, or a 15% margin, and non-GAAP net income was $0.11 per diluted share. Free cash flow was $13.1 million in Q2 and $79 million for the first half. Total RPO was $1.03 billion, up 11% year over year, and current RPO was $614 million, up 3%. For Q3, management expects total revenue of $215 million to $216 million, subscription revenue of $196 million to $197 million, professional services revenue of about $19 million, non-GAAP operating income of $33.5 million to $34.5 million, and non-GAAP EPS of about $0.11. For FY27, management raised subscription revenue guidance to $782.5 million to $784.5 million and maintained total revenue guidance at $866.5 million to $868.5 million, with non-GAAP operating income of $139 million to $141 million, non-GAAP EPS of about $0.47, and free cash flow of about $135 million at a roughly 16% margin.

Rory Read said the company remains in the transition and execution phase, but believes the transformation is on track and the business is strengthening across NAR, renewals, and enterprise demand. He emphasized that Sprinklr’s AI-native platform is resonating with customers, citing more than 200 AI engagements underway, a major new $20 million-plus deal, and a $4 million expansion as evidence of platform traction. His tone was constructive but disciplined: he repeatedly stressed that the company must execute well in Q3 and Q4 to enter an acceleration phase in FY28.

Anthony Coletta focused on the financial progression: 1% revenue growth in Q2, 3% subscription growth, 102% subscription NDR, 112% NDR for the $1 million cohort, and $1.03 billion of total RPO, up 11% year over year. He called out margin pressure from services, including negative 22% services gross margin, partner cost overruns, and execution challenges in one region, but noted that the company generated $13.1 million of free cash flow in Q2 and $79 million in the first half. He also highlighted a strong balance sheet with $453 million in cash, cash equivalents, and marketable securities and no debt, plus $75 million remaining under the $200 million repurchase authorization after completing the $125 million ASR.

Analysts pressed hard on whether the weakness in professional services and softer billings reflected a fixable execution problem or a sign of weaker demand. Management said it was mainly an execution and mix issue tied to a large implementation and higher partner expense, not a demand problem, and reiterated that large deals and pipeline remain healthy. Questions also focused on sustainability of >110% expansion, the role of partners versus internal services, AI engagement quality, and Middle East disruption; management said renewals and customer sentiment are improving, AI engagements are becoming more outcome-driven, and the Middle East remains choppy but active.