Samsara Inc. (NYSE:IOT) Q2 2026 Earnings Call Transcript

Samsara Inc. (NYSE:IOT) Q2 2026 Earnings Call Transcript September 4, 2025

Samsara Inc. beats earnings expectations. Reported EPS is $0.12, expectations were $0.07235.

Mike Chang: Good afternoon, and welcome to Samsara’s second quarter fiscal 2026 earnings call. I’m Mike Chang, Samsara’s vice president of corporate development and investor relations. Joining me today are Samsara chief executive officer and cofounder Sanjit Biswas and our chief financial officer, Dominic Phillips. In addition to our prepared remarks on this call, additional information can be found in our shareholder letter, press release, investor presentation, and SEC filings on our Investor Relations website at investors.samsara.com. The matters we’ll discuss today include forward-looking statements. Actual results may differ materially from those contained in the forward-looking statements and are subject to risks and uncertainties described more fully in our SEC filings.

Any forward-looking statements that we make on this call are based on assumptions as of today, September 4, 2025. You undertake no obligation to update these statements as a result of new information or future events unless required by law. During today’s call, we will discuss our second quarter fiscal 2026 financial results. We’d like to point out that the company reports non-GAAP results in addition to and not as a substitute for or superior to financial measures calculated in accordance with GAAP. We also report both actual and constant currency growth rates for certain metrics. On the call, we will only provide constant currency commentary when there’s a material difference. Reconciliations of GAAP to non-GAAP financial measures and additional information on constant currency are provided in our press release and investor presentation.

Make opening remarks, dive into highlights for the quarter, and then open the call for Q&A. With that, I’ll hand over to Sanjit.

Sanjit Biswas: Thanks, Mike, and thank you everyone for joining us today. Samsara delivered another strong quarter of durable and efficient growth. We ended Q2 with $1.6 billion in ARR, growing 30% year over year. Our $100,000 plus ARR customers now contribute close to $1 billion of ARR, up 35% year over year, and now represent 59% of our total ARR. In Q2, we added 17 customers with more than $1 million in ARR, a quarterly record. Our $1 million plus ARR customers crossed an important milestone in Q2. They now generate more than 20% of our ARR, approximately $350 million. Our strategy to partner with the world’s largest and most complex operations organizations is working and is fueling our growth at scale. In Q2, we partnered with many large enterprises including Alaska Airlines, the fifth largest airline in The US, SRM Concrete, the largest ready-mix concrete provider in The US, and one of the largest Fortune 1,000 rental equipment companies in North America.

We’re excited to work with these industry leaders and help them operate smarter. As we grow our customer base, we’re also scaling our data asset. We reached another company milestone in Q2. We now process approximately 20 trillion data points annually on our platform. Our unique and proprietary data asset is not found on the Internet. It pulls data from gateways, cameras, and sensors that we’ve deployed across our customers’ vast operations breadth across diverse asset types, end markets, and geographies. We’re proud to partner with our customers to build the world’s largest physical operations dataset which provides us unique visibility into where and how customers run their operations. Combining this with AI, we’re delivering actionable insights that solve their toughest challenges.

Q&A Session

In June, we hosted our biggest customer conference yet, Samsara Beyond. During the three-day event, thousands of leaders joined us to hear about how our newest innovations, and to share their feedback and insights. We also learned about the challenges they’re facing, including increased demand to build AI infrastructure, safety risks, capital expenditure costs, and employee churn. These conversations make our customers’ top priorities clear. We’re seeing a notable shift towards AI and automation as they modernize manual processes. They want a single unified platform to manage their complex operations. And they want to extend risk management from vehicles into the field to protect their workers, and to use digital tools to help with high employee turnover and labor shortages.

Our customers are increasingly turning to AI to help them scale their output while running safer, more efficient, and more sustainable operations. During Beyond, we also hosted our connected operations awards ceremony. We celebrated 17 global customers who achieved an outsized impact with our platform. I’d like to share some of the highlights from a few of our winners. Maxim Crane, a leading crane rental company in The US, was our most innovative workforce winner. They saved $13 million in maintenance costs by shifting their maintenance program from reactive to proactive. They also saw a 94% reduction in harsh driving and an 87% reduction in speeding. Another winner was Mohawk Industries, the largest flooring manufacturer in the world. They won excellence in systems efficiency.

They saved $7.75 million by using planned versus actual analysis to reduce their mileage by 4.2 million miles. They saved an additional $500,000 from rightsizing their fleet. They also saw safety gains, including a 54% reduction in speeding. We are proud to partner with our customers to make a real-world impact on their operations. Our connected operations platform is solving our customers’ toughest challenges. As we scale to over 20,000 core customers, our flywheel of innovation is accelerating. We build products for our customers that deliver a clear and fast ROI. As our customers use these products, they contribute data to the platform. This growing data asset then allows us to build new products. It is fueling the expansion of our platform at an unprecedented rate and I’m excited about the opportunity to deliver even more customer impact through our platform.

At Beyond, we announced a record number of new products and features. These products help our customers by protecting their frontline workers, modernizing the frontline worker experience, improving asset maintenance, optimizing asset utilization. Safety is a top priority for leaders. Driving is one of the 10 most dangerous jobs in The US, with fatal crashes up 49% in the past decade and insurance premiums up 40%. Leaders also want to modernize their frontline worker experience to improve productivity. And are looking for new ways to improve asset maintenance and utilization as rising costs and high interest rates are creating pressure to reduce capital expenditures. To help our customers with these challenges, we launched new products, including asset maintenance, which helps organizations monitor manage the upkeep of their vehicles and equipment, commercial navigation, which is tailored to the unique constraints of large commercial vehicles, route planning, which creates and optimizes routes with fewer miles and vehicles, AI multicam, which gives drivers real-time 360-degree video coverage around any vehicle.

And worker safety, which protects frontline workers wherever they work. It’s never been a more exciting time partnering with our customers to improve their operations. As we build for the long term, we’re investing in innovation to meet our customers’ evolving needs. Our open platform and partner ecosystem, and our leadership and culture. First, we announced many new features in addition to our new products at Beyond. For our customers’ frontline workers, we redesigned our driver app to be more intuitive and engaging with streaks and short training videos. We also built new AI-enhanced DVIRs to help workers improve compliance and accuracy. To help reduce risk, we built weather intelligence. Which provides real-time ground-level weather insights.

All of these new features are broadly available to our customers, and we’re looking forward to increasing our customer impact. Second, our open ecosystem and the work of our partners are central to our success. We’ve now expanded our partner ecosystem to over 350 integrations, and our largest customer on average are using six of them. This demonstrates the value of partnerships in helping customers unify their operations. We’re continuously building on this by adding dozens of new partners, including Element, Rivian, Happy Robot, and Marsh. And we’re also deepening our existing integrations to provide even greater value. Lastly, I’m happy to share that Gary Steele has joined our board of directors. Gary is a proven leader with over thirty years of leadership experience in the technology industry.

His expertise in enterprise software and AI will be invaluable as we continue to drive multiproduct adoption, deliver clear ROI for our customers. We’re confident that his contributions would be a great asset, and we look forward to working with him. We are seeing great customer impact as we continue to scale. Our connected operations platform now sees approximately 20 trillion data points, 300 million digitized workflows, and 90 billion miles annually. With this data, we’re driving actionable AI-powered insights to help our customers achieve even more ROI from our platform. Each year, we compound the impact we can make for our customers and we’re excited for the decades-long opportunity ahead. We want to thank all of the Samsarians, customers, partners, and investors for joining us on this journey.

I’ll now hand it over to Dominic to go over the financial highlights for the quarter. Thank you, Sanjit. Q2 was another quarter of durable growth and improved profitability.

Dominic Phillips: The quarter was highlighted by strong performance across several key metrics, including another quarter of 30% plus year-over-year growth at a larger scale, 19% year-over-year net new ARR growth, which accelerated sequentially at a larger scale, 17 new $1 million plus ARR customers, which was a quarterly record. More than 20% of total ARR from $1 million plus customers and year-over-year ARR growth for this cohort accelerated sequentially at a larger scale. Approximately $1 billion of ARR from 100k plus ARR customers, an increase of 35% year over year, and representing 59% of total ARR, and 8% of net new ACV from new products launched since last year. And while we experienced a few elongated sales cycles in Q1 following Liberation Day, which contributed to our strong growth, all of the impacted larger transactions closed in Q2, and we didn’t experience further tariff-related impact in the quarter.

Looking ahead, we believe we are well positioned to deliver durable growth and create long-term shareholder value for a few key reasons. First, we have a unique defensible data advantage. By instrumenting physical assets, we generate a large and growing proprietary data asset that cannot be replicated or sourced from the Internet. Second, AI is accelerating our innovation. We are releasing new products and meaningful features at a faster pace, driving higher customer engagement and usage. Third, our business model scales with physical assets, rather than headcount or knowledge workers, and aligns us to end markets that are poised to benefit from major initiatives like the global AI infrastructure build-out. Fourth, our products have a differentiated value proposition and mission-critical workflows that deliver fast and tangible ROI, with quick payback periods that make us essential to our customers’ operations.

And lastly, we’re targeting the large and less discretionary operations budget, which represents approximately 80% of our customers’ revenue on average. And because we help them optimize this significant and durable cost base, we have a large opportunity to drive customer impact and long-term growth. Now taking a look at our Q2 results, Q2 ending ARR was $1.64 billion, an increase of 30% year over year. Within that, we added $105 million of net new ARR, an increase of 19% year over year, or accelerating sequential growth at a larger scale. And Q2 revenue was $391 million, growing 30% year over year or 31% in constant currency. Several factors drove our strong top-line performance in Q2. First, we focus on serving large enterprise customers to drive efficient growth at scale.

In terms of large deals, our second highest quarter ever. We signed $71 million plus net new ACV transactions in Q2. This reflects the success of our investments to support larger customer opportunities. At the same time, larger deals have inherently longer and less predictable sales cycles, which means that their timing may introduce more variability into our quarterly results than in the past. In terms of large customers, we ended Q2 with approximately $1 billion of ARR from 100k plus ARR customers, an increase of 35% year over year, representing 59% of total ARR up from 57% one year ago. We also ended Q2 with $1,471 million dollar plus ARR customers, including a quarterly record increase of $171 million dollar plus ARR customers contributed more than 20% of total ARR, and year-over-year growth from this cohort accelerated sequentially at a larger scale.

Second, landing new customers remains a key driver of our growth strategy that fuels future expansion opportunities. In terms of new customers, we added our third highest number of net new core customers in Q2, surpassing more than 1,000 for the fourth time in the past five quarters. Nine of the top 10 new logos adopted two or more products and eight of the top 10 adopted three or more products in their initial transactions. These new logos included two public sector customers, one with a state-level department and another with one of the largest counties in The US. A top five US airline, one of the largest employee-owned contractors, and The UK subsidiary of one of the largest global retailers, which adopted four products in its initial contract.

Video-based safety, vehicle telematics, connected workflows, and connected training. In terms of expansions, all 10 of the top 10 expansions in Q2 included at least two products, and five of the top 10 included three or more products. Additionally, 15 of our top 25 ARR customers expanded in Q2, and we achieved our target dollar-based net retention rate of approximately 115% for core customers. And third, we demonstrated strong execution in several frontier markets. In terms of international, 15% of net new ACV came from non-US geographies, the largest of which was Europe, which accelerated net new ACV growth sequentially to its highest level in the last four quarters. In terms of end markets, we saw momentum across construction, public sector, and manufacturing.

Construction drove the highest net new ACV mix of all industries for the eighth consecutive quarter and delivered its highest net new ACV mix in the last six quarters. Public sector strength came from wins across several state departments including Nebraska DOT, as well as large municipalities. Including the city of Nashville and a leading passenger transit agency in Los Angeles. And manufacturing delivered its highest net new ACV mix ever, led by SRM Concrete, the largest US ready-mixed concrete provider. Their initial purchase included video-based safety, vehicle telematics, equipment monitoring, connected workflows, and commercial navigation. In a pilot, they saw faster accidents response times with connected workflows, exonerated drivers and not-at-fault accidents, improved job site efficiency with real-time visibility, and improved customer experience through more on-time deliveries using commercial navigation.

And in terms of emerging products, 8% of our net new ACV in Q2 came from our new products launched in the past year. Led by asset tags, connected workflows, connected training, asset maintenance, AI multicam, and commercial navigation. This quarter, we signed our largest ever asset tags deal with Bonnie Plants, the largest US supplier and producer of vegetable and herb plants. They deployed 15,000 asset tags to track their owned and leased cart fleet reducing asset loss and theft, while improving worker efficiency. In addition to driving strong top-line growth, we continued to deliver operating leverage across our business as we scale. Up one percentage point year over year. Non-GAAP gross margin was 78% in Q2, Non-GAAP operating margin was 15%, up nine percentage points from one year ago, and free cash flow margin was 11% in Q2, up seven percentage points year over year.

Okay. Now turning to guidance, which is based on FX rates as of August 2. For Q3, we expect revenue to be between $398 and $400 million, representing 24% year-over-year growth 23 to 24% growth in constant currency. Non-GAAP operating margin to be 15%, and non-GAAP EPS to be between 11 and 12¢. For full year FY ’26, we expect revenue to be between $1.574 and $1.578 billion, representing 26% year-over-year growth. Non-GAAP operating margin, to be 15%, and non-GAAP EPS to be between 45 and 47¢. And finally, please see the additional modeling notes in our shareholder letter. To wrap up, Q2, we delivered high growth at scale, while also delivering operating efficiency gains. Looking ahead, we believe Samsara is well positioned to sustain durable and efficient growth because we generate a unique defensible data asset that powers differentiated AI innovation and deeper customer engagement.

We are aligned with secular growth in physical operations that is poised to benefit from major initiatives such as the global AI infrastructure build-out, and we deliver tangible ROI through mission-critical workflows and help customers achieve fast payback periods on their investments. We look forward to building on this momentum as we help our customers operate more safely, efficiently, and sustainably at a greater scale. And with that, I’ll hand it over to Mike to moderate Q&A.

Mike Chang: Thanks, Dominic. We will now open the line up for questions. When it’s your turn, please limit your questions to one main question and one follow-up question. First question today comes from Alex Zukin with Wolfe. Followed by Matt Hedberg with RBC. Hey, guys. Thanks for taking the question.

Alex Zukin: Maybe the first one is just in terms of the early customer conversations coming out of Beyond, when you stack rank some of the new product launches that are getting the most traction, where you’ve seen the fastest movement from interest to pilot or deployment, kind of walk through those a little bit and maybe help shape how we should think maybe for the even the full year as you look at your guidance, that net new ACV growth from new products. Kinda trending? And I have a quick

Sanjit Biswas: Sure. I’ll take that one. Alex, this is Sanjit. So Beyond was great. I think a lot of enthusiasm and excitement from the customer base, especially for the new products and features we launched. You know, I would say a number of them are hitting and resonating well. We launched routing and commercial navigation. That’s relevant in a number of industries. It improves safety and efficiency for their operations. We also saw a lot of interest around maintenance and then continued interest in things like asset tags that we launched the previous year but are gaining momentum. With all of these products, it takes some time for these customers to figure out how they’re gonna adopt them on the platform and the change for the frontline.

These folks often have tens of thousands of frontline workers, so putting a new app in front of them is a big change. That being said, I think we’re seeing really positive momentum, trials and pilots in a number of accounts across different industries. We’ll come back to you and report on that continued revenue growth. But as Dominic highlighted, 8% of the new ACV was coming from these other applications, so we’re really pleased with the initial momentum.

Alex Zukin: Perfect. And then maybe just as a follow-up, Dom, the net new ARR, a hundred and five. Accelerating growth, strong large deal and logo. Seems like you really kinda hit it out of the park this quarter with sales execution. Maybe just help us understand how this performance kind of this bounce back after Q1. How much of that was macro kinda figuring itself out? How much of that was new product? How much of that was linearity from some of the deals that slipped. Give us a sense for how to think about both that and kind of the what looks like a pretty conservative guide for the second half.

Dominic Phillips: Yeah. Maybe I’ll just bifurcate the quarter into kind of the two components that the of the macro tariff and then just the strength in the quarter. I think as I called out in the prepared remarks as we discussed last quarter, there were a few larger deals, I’d say, kind of totaling you know, mid-single-digit millions of net new ACV that we originally had forecasted would come in to Q1, but ultimately push to Q2 after the Liberation Day tariff announcements. All of those larger impacted deals closed in Q2. We didn’t experience any further impact in the quarter. And so, really, if you look at the, you know, the net new ARR growth it was in the, you know, the low double digits. really, for the first half of the year combining both kind of this Q1 and Q2, I’d say beyond that, Q2 was, you know, really strong, and I think, you know, the call out is just the large customer momentum now doing almost a billion dollars of ARR from our 100k plus ARR customers, up 35% year over year.

And then, really, we’re starting to see more traction out of our million-dollar plus ARR customers landing a quarterly record 1720% of overall ARR. And so that also contributed to the strength in the quarter.

Alex Zukin: Perfect. Thank you, guys. Congrats.

Mike Chang: The next question comes from Matt Hedberg with RBC. Followed by Chris with Morgan Stanley.

Matt Hedberg: Great. Thanks for taking my questions, guys. Congrats from me as well. Really strong results. I’m curious. You know, building on the new product success, you know, your traction in AI is notable. And in a market where investors are concerned about AI disrupting software, it feels like you guys are well positioned to actually benefit from that, and it seemed like that was a real focus of Beyond. I guess my question is as you think broader about the product portfolio and the build-out, you know, do we need to think about new ways to sort of monetize and price and package, you know, AI-based functionality? Either does any of that evolve as you continue to roll out functionality leveraging, you know, the existing data on the platform?

Sanjit Biswas: Yeah. Absolutely. So I think we have a lot of exciting things going on with AI. One is it’s enhancing the core product experience, which is really beneficial for our customers as they think about their safety and efficiency. So we’re able to surface deeper insights, help them really make sense of all of this data, and then as you mentioned, as a byproduct of all this data flowing into the platform, these 20 trillion data points, we can identify new sources of value. So example, one of the features we launched at Beyond was this ability to go see at a moment’s notice the weather, the current weather status anywhere on the roads in The US and really, like, up to the minute sort of views. That’s not something that was possible until we had this scale of data and then AI to process it, understand these conditions, help provide it in a privacy-preserving sort of way.

So I think over time, we will be able to introduce net new products that are enabled by AI, but I would also expect that our current products get better and better because of what we’re doing with AI.

Matt Hedberg: That’s great. And then, Dom, you know, you mentioned the largest ever Acetag deal with Bonnie Plants. Great to hear the success. I think we all were excited coming out of that initial product launch. I’m wondering on a deal like that, is there any way to think about, you know, how that adds to customer ACV? And really how that customer thought about the ROI? You know, you mentioned some of the key reasons in terms of asset inventory, but you know, could you walk us through maybe just some rough idea of sort of an economics of a deal like that? Thanks, guys. Congrats.

Dominic Phillips: Yeah. And that’s an interesting deal because the asset tax was the biggest component of it, but because of the asset tag opportunity, it allowed us to also land with some of our core products telematics and safety. So that really was a big expansion. Of that. And I think, you know, and use cases around asset tags, we’re really replacing nothing. You know? So they were losing these, you know, owned and leased cards. And so now being able to track them, they’re gonna be able to save a lot of money in asset loss and theft. And so a lot of the customers are coming from, you know, no technology. They’re really just kind of starting out on their digital transformation journey. And so being able to deploy technologies to these use cases really can drive a lot of ROI.

Matt Hedberg: Thank you.

Mike Chang: Great. The next question comes from Chris with Morgan Stanley. Followed by Michael Turrin with Wells Fargo.

Chris Quintero: Hey, Sanjit. Hey, Dominic. This is Chris on for Keith Weiss here. I wanted to ask about the large customer momentum that you’ve got going on here, really encouraging to see. You mentioned some of the investments you’ve been making there to support those larger deals. So can you remind us kind of what those were and how those have progressed versus your expectations and kind of how you look on a go-forward basis of streamlining some more of those bigger deals?

Sanjit Biswas: I’ll take that one. So we’ve been making investments to support these large customers across the board. On the sales side, we have a dedicated team focused on these strategic accounts. But more broadly, we have teams that are set up with implementation and change management, adoption of these products across the board, their sustained sort of use and kind of value unlock. And then on the software side and the product side, we’ve been making a lot of investments around security, making sure the integrations and the APIs are really robust, set up to operate at scale technologies like FirstNet, which are relevant for a lot of these large enterprises and more. So I would say that it’s been a company-wide effort to support the large enterprise.

It’s great to see us breaking records on that front. The $17 million plus customers was a quarterly record. So I think we’re gonna continue to invest in that area. And the other exciting thing is these are very large complex operations where there’s a lot of opportunity to unlock more value. So these core products are doing great. But as we get to know these customers, we’re starting to do workshops with them and find additional areas of value that we can really help.

Chris Quintero: Got it. That’s super helpful. Thanks, Sanjay. And then I want to also follow-up on the European success, another quarter of accelerating that new ACV growth there. Are there any specific unlocks or learnings that you’ve gathered over the past few months and years as you’ve penetrated that market that you can bring to the broader international rollout?

Dominic Phillips: Yeah. I think it actually kind of dovetails off to what Sanjit said around the large customers. It’s just been sustained investment in some of these regions where there’s, you know, more commercial vehicles in Europe than there are in North America, but, you know, making steady investments around go-to-market sales reps, sales engineers, the marketing resources, landing Lighthouse customers that can, you know, be referenceable to other accounts. And then making all of the kind of the R&D investments required around the platform, the security, the scalability. We’ve called out in previous quarters that there are product-specific features that are required, like in Europe, bridge strikes is really critical, and so making those investments has allowed us to have some continued success there.

Chris Quintero: Awesome. Thank you so much, guys.

Mike Chang: The next question comes from Michael Turrin with Wells Fargo followed by Jim Fish with Piper Sandler.

Michael Turrin: Hey. Great. Can you hear me okay? Sorry. I just clicked over.

Mike Chang: Yeah. We can hear you.

Michael Turrin: Okay. Excellent. I want to just spend a few moments on a couple of just key points that you’re flagging in the prepared remarks. You mentioned the AI infrastructure build-out specifically in the letter. Would be curious to just hear you speak more to where your customers fit within those end markets and how you’re prioritizing that opportunity from a go-to-market perspective and also curious to hear any commentary around what you’re seeing from the public sector can appreciate the diversification, but those two areas, I think, are particularly in focus right now. Thanks very much.

Sanjit Biswas: Sure. I’ll take that one. You know, AI infrastructure build-out is a really interesting theme. If you think about who our customers are, they’re the world of physical operations. These are folks like the construction companies, the field services companies like the electricians, for example, that are involved in these projects as well as the electric utilities. So almost all of them are trying to find ways to keep up with this demand and operate smarter. These are very compressed schedules. They demand a lot of efficiency, and they also have to be safe while they’re doing all this work. So those would be the end markets that we’re seeing that kind of traction in. Specifically, construction had the highest contribution to our net new ACV mix for the eighth quarter in a row.

So it’s really this kind of continued push that we’re seeing from these industries. And then somewhat related to that in the public sector, this is an area where there are a lot of assets. If you think about all of our towns and cities that we live in, they require infrastructure to operate everything from waste management and school buses to, you know, the folks running inspections on the roads. And so what we’re seeing there is that this end market is waking up to how much money can be saved for their citizens by more efficient operations. And I think we’ve built the right feature set, and we’ve also done the right security work to meet the standards that many of these folks have in the state and local opportunities.

Michael Turrin: That’s all super interesting. Thank you very much.

Mike Chang: The next question comes from Jim Fish with Piper Sandler. Followed by Matt Bullock with BofA.

Jim Fish: Hey, guys. I wanted to follow-up on one of the prior questions. Around the big quarter for $1 million plus ARR deals. Is there a way to think about how much of that 20% is being, I’ll say, more of a mid-market that is consolidated on top of Samsara as kind of the base versus, say, you know, very up end of the market Global 2000 and sort of why now we’re starting to see that million-dollar cohort really coming on and Dom for you, how you’re navigating these larger deals in the context of your projections given the timing uncertainty? Thanks, guys.

Dominic Phillips: Yeah. It definitely there are examples of some smaller customers that have really expanded and, you know, gone more wall to wall across our operations on Samsara, but primarily the majority of the $147 million plus ARR customers that we have today are really large enterprises with complex physical operations, and we’re really just scratching the surface in terms of getting started with them often in our core products. But as we’ve really picked up the pace of our innovation over the last couple of years, you know, I called out a number of deals where customers are landing with three, four, five products out of the gate. And so we’re finding more of these use cases with the large customers, and again, that was a big driver of the growth in the quarter.

Mike Chang: Okay. Next question comes from Matt Bullock with BofA. Followed by Kirk Materne with Evercore.

Matt Bullock: Fantastic. Thank you. Great to hear that there was no tariff impact during the quarter, but Sanjit, would love to hear about how some of those conversations have evolved exiting April as things settle down, customers figured out some of those asset procurement strategies. I guess, you know, a different way, do we think we’re out of the woods here? And customers have done kind of the groundwork to continue to stay nimble in an evolving tariff environment.

Sanjit Biswas: Yeah. Matt, I think you sort of put your finger on it, which was that back in April, it was a little bit of a shock to the system, especially for our customers. These are people operating in very asset-heavy industries, and so they procure a lot of equipment. And they had to really take a moment to figure out what their strategies would look like. At this point, there’s still uncertainty on the tariff rates themselves, but tariffs appear to be here to stay. What I’m hearing from customers is they’ve adapted to the environment. They’ve made their plans. They are trying to find ways to be more efficient with the assets they have. So we’re seeing, you know, them trying to essentially stretch asset lifespans. They do that through smarter asset maintenance programs, which is what we’re offering on our platform now.

They’re also trying to optimize the efficiency and the utilization of these assets. Which, again, we can provide with our asset products. And so I think we’re well set up to help solve these real problems for them. But while there’s still uncertainty on the horizon of the specific tariff rates, I think the customers have really adapted to this new environment.

Matt Bullock: Super helpful, Sanjit. And then a quick one for Dominic, if I could. You know, certainly a larger net new ARR beat than I think we were all expecting, particularly the enterprise segment. Can you maybe just help us thinking about, you know, sales productivity trends within that? Sales organization versus I know you’re obviously building out and adding additional resources in that market specifically. But maybe help us parse through what you think drove that larger beat.

Dominic Phillips: Yeah. I mean, I’d say the growth in this quarter Q1, you know, the first half of this year has really been more balanced than maybe it has been in previous years where, you know, a couple of years ago, we were really adding a lot more capacity. And before that coming out of COVID, more of the growth was driven out of, you know, productivity with lower capacity. I think going into FY26, we’ve really found a nice balance of continuing to add more sales capacity, but seeing really good productivity, you know, being driven by a lot of the efforts of the R&D organization building a lot of the new products that are, you know, allowing us to solve even more use cases for customers and allowing our sales reps to be even more productive. So we feel good about the balance, and it’s gonna allow us to continue to make capacity investments going into the second half of the year.

Matt Bullock: Fantastic. Thank you.

Mike Chang: Next question comes from Kirk Materne with Evercore followed by Alex Sklar with Raymond James.

Kirk Materne: Yeah. Thanks very much. Sanjit, I was just wondering, you guys obviously have a much more expansive product portfolio today than you did a couple of years ago. From a go-to-market perspective, how do you make sure that each of these newer products, each of which have a big opportunity in front of them, get the right type of care and feeding from the sales organization? Are you doing anything in terms of spiffs, uncertain project or products, or, you know, specialized sales reps? Just kinda wondering how you’re balancing the fact that you guys just have a much more broad-based product portfolio today than a couple of years ago. Thanks.

Sanjit Biswas: Yeah. Kirk, I think you put your finger on a very practical problem for us, which is we do have a lot to offer our customers. We highlight the value of the platform first and foremost. Most of our customers are not looking to solve just one problem, but they often have many different operational challenges they want technology for. So we do have generalist sales reps that are familiar with the portfolio. They have sales engineers and specialists they can call in for additional help if they, you know, need to talk about a specific integration or a specific feature on there. And then over time, we do experiment with things like SPIFFs, with specialists, and other kind of tactics, I guess, to help with that. But it’s an area that we’re continuing to focus on. We want to make sure all of these products are successful, and most importantly, that we get the customers the assistance that they’re really looking for.

Kirk Materne: Okay. And you highlighted a number of your integration partners this quarter. I was just kinda curious, you know, having those integrations think you mentioned your biggest customers have, you know, six integrations. Or thereabouts. You know, is that sort of a check the box for your big partner or your big customers? Meaning, if you didn’t have those, that would make the conversation more difficult, or is it a real sort of differentiator when you’re going up against other competitors in the market?

Sanjit Biswas: Thanks. I would say much more of the latter. We’re the first company to offer this sort of widespread integration ability, and the quality of the integration matters too. It’s one thing to, you know, sign a partnership. It’s another thing for the data to flow really well. Us to have bidirectional data feeds, things like that. And it’s an area that our customers are getting a lot of value from. They have been waiting for a company to come in and integrate all of this or really unify all of this data in one place. And that’s everything from OEM telematics to fuel cards to insurance integrations, payroll providers. There’s a lot you can do with this data, a lot of value for the customer. So, I think it’s a huge differentiator for us.

And the quality of these integrations really matters. These customers have often been burned in the past by vendors that have said they’ll do an integration, but it doesn’t really work for them. When we were able to show these working out of the box and the quality is excellent, they get excited and they want to do more with us. Thank you.

Mike Chang: The next question comes from Alex Sklar with Raymond James. Followed by Dan Jester with BMO.

Jessica: Hi. This is Jessica on for Alex. Can you hear me?

Sanjit Biswas: Yes. Yes.

Jessica: Alright. Yeah. Just one quick question from us. Has there been anything structural about international opportunity and differences in the competitive environment that you think could be gaining Samsara from achieving growth at levels similar to what you’ve been seeing domestically last few years? Been really impressive. And, also, have you been seeing anything about competitors being more aggressive on price as they’re trying to be winning deals from you? How’s this all interacting?

Sanjit Biswas: I’ll take that one. I would say the set of competitors has been pretty consistent for the last several years for us. There are several of them. Many of them are point solutions or regional players. But we’re kind of seeing the same names come up over and over. And the way we differentiate again is the sort of platform approach, the way we engage with our customers, the amount of value we’re able to unlock across our operations. And then, to the second part of your question around pricing, that is often where some of these competitors go is they’ll discount very heavily in order to try to compete for these deals. We, again, try to really demonstrate that we can do more for these customers, help them find more value.

Around 80% of their revenue is invested in their operations, so this is a huge area of expense for them. And so if we can find additional areas of savings, things like that, they’re not focused on price. They’re focused on what can I do with all this technology? Right.

Jessica: Got it. Thank you.

Mike Chang: The next question comes from Dan Jester with BMO followed by Dylan Becker with William Blair.

Dan Jester: Great. Good afternoon, everyone. Thanks for taking my question. A couple weeks ago, you announced a pre-delivery installation program to get your hardware into the trucks before customers buy them. And I think in the press release, it said that, you know, you expect this to be the standard for the industry over time. Maybe can you just expand on the value of the preinstallation and what kind of maybe, competitive moats that that provides if you can get the hardware in before the truck even gets shipped to the customer. Thank you.

Sanjit Biswas: Yeah. Absolutely, Dan. So I think maybe just for a little bit of customer context, if you’re a larger enterprise and you’ve got 5,000 or 10,000 trucks, in a given year, you’re swapping out a thousand of them. Which means that sometimes in a given month or even a week, you’ve got dozens of vehicles getting changed out. For us to be able to deliver have those vehicles be delivered with Samsara onboard, it really helps eliminate a huge operational headache. And, again, those vehicles may be delivered to different cities all over a country. So it’s an area where we’re able to streamline our customers’ operations provides a much better experience for them. It makes sure those vehicles are ready to go on day one. And it’s something that customers have been asking for, and we’re excited to be able to offer because of scale and our presence in the market.

So very glad to get that program off the ground. We’re continuing to expand that program, partnering with even more OEMs. So hopefully, more good news to come on that front.

Dan Jester: Great. Thank you. And then maybe just to revisit, the strength in the performance in sort of larger customers from a different angle, I know it’s less of a focus, but maybe you can talk about what you’re seeing with your smaller and mid-sized customers that maybe do have maybe a little bit more macro impact? Are you seeing any change in their behavior, or has it been pretty consistent? Thank you so much.

Dominic Phillips: Yeah. Dan, it’s Dominic. Yeah. It was very consistent, and while we had a very strong large customer, a 100k plus, million-dollar plus ARR quarter, we also saw a lot of strength in commercial mid-market. So and if you just look at the numbers, the ARR mix from 100k plus customers was 58% last quarter and went up to 59%. So it’s definitely growing faster than our overall base, but it’s not like it stepped up, you know, exponentially. Which implies that the mid-market and kind of SMB part of our business also had strong growth in the quarter.

Dan Jester: Great. Thank you so much.

Mike Chang: The next question comes from Dylan Becker with William Blair. Followed by Derrick Wood with TD Cowen.

Dylan Becker: Hey, gentlemen. Appreciate it. Maybe, Dom, starting with you, if we look at the outperformance on the revenue line, kind of a notable step up here, was wondering if you could kind of help us through that a little bit more, whether that was kind of conservatism given some of the uncertainty we saw last year, any linearity of kind of ramp and go lives. Obviously, large customer momentum, but help us parse through kind of the revenue outperformance, if you would, please.

Dominic Phillips: Yeah. Thanks for asking that. Yeah. I’d say overall, even going into the quarter and as I look into the back half here, like, no change to our guidance philosophy. You know, we’re still gonna try to ensure that we’re setting revenue guidance with a lot of confidence. You know, that accounts for, you know, various downside scenarios. If we don’t see those scenarios ultimately play out, it generally results in us being able to outperform the guidance. For Q2 specifically, there was even more outperformance than normal. Obviously, we got some revenue benefit from the stronger bookings linearity with some of those Q1 deals slipping in. And closing in early in Q2. We don’t have that same dynamic into Q3. And so that started the quarter off strong in terms of bookings linearity and, you know, you saw that outperformance flow through to the beat in the quarter.

Dylan Becker: Very helpful. Thank you. And then maybe for you or Sanjit as well too. Obviously, the emphasis coming out of Beyond was on kind of the accelerated cadence of new product innovation. Wonder, how maybe at the advent of AI, kind of the cost of building and introducing new products and capabilities is helping contribute to kind of some of this enterprise and million-plus strength that we’re seeing, kind of the receptivity willingness for them to try more products, but also your ability and appetite to have more irons in the fire. Over time as well. Thank you.

Sanjit Biswas: Yeah. Dylan, I think, the interest in AI, it’s certainly strong in the enterprise. We do see it in the mid-market as well. We collect a tremendous amount of data on the platform. There’s a lot of value in that data. But you really do need AI to help you sift through it all, find insights, and really help change behavior. And that’s ultimately where the value comes from. That’s how they get the safety and efficiency gains. I think we’re getting a lot of new ideas from our enterprise customers because they have large complex operations. They’re really experts in their various industries, and so they often lead us to really innovative new solutions, and we kind of co-develop them together. But for us, we’re excited about what AI is able to do, and the capability set’s just changing every year.

Whether it’s large language models or some of these vector databases and other technologies coming to market. So we’re generally excited about being able to find new sources of value for all kinds of customers, especially in the enterprise, but down in the mid-market SMB as well.

Dylan Becker: Great. Thank you.

Mike Chang: The next question comes from Derrick Wood with TD Cowen followed by Junaid with Truist.

Derrick Wood: Great. Thanks, guys. Congrats on a great quarter. It’s been over a year since the release of asset tags, and just curious, how is the product done versus your expectations? And did we think of this as kind of a long tail growth dynamic, or is this something that could really start to contribute to larger deals? And move the needle more on overall growth as we look out over the next twelve to eighteen months?

Dominic Phillips: Yeah. We’re really pleased with the performance of tags. I think it’s just notable that it’s a product that’s addressing a really large problem, but where technology frankly doesn’t exist today. So we’ve got these customers, and they’ve got all kinds of, you know, assets from machinery, you know, out there. And they can’t locate them. They go lost. They don’t know where they are. And so this is really the first time that this kind of technology using, you know, technology has really been available for these customers. And so the product’s been out for a year. We’ve had a lot of good conversations and trials with customers. And then, you know, starting to result in some pretty big deals where, you know, called out Bonnie Plants as our largest asset tag deal ever, 15,000 asset tags in the quarter.

And so we had another really large one, I think, in Q4 a couple of quarters ago. And so we do expect this will continue to pick up as customers are more aware that this technology exists.

Sanjit Biswas: And I would just add, it takes some time for them to realize that this is now possible. Many of them spend tens of millions of dollars replacing these lost or stolen assets. They spend a lot of time searching for these assets in their operations. And they’ve done it that way for, you know, twenty-five, fifty, hundred years. So they’re starting to realize technology can help, but it’s an education process for us.

Derrick Wood: Interesting. Thanks. And I guess, Dom, I mean, of the 8% of new ACV from new products is asset tags the biggest component of that. And is there maybe a clear number two within that mix that you’d highlight?

Dominic Phillips: It was actually pretty spread out across all of the products that I mentioned. So, like, Acetags definitely had a great quarter, but commercial nav, workflows, maintenance, navigation, all contributed to the 8%.

Derrick Wood: Great. Okay. Thanks.

Mike Chang: The next question comes from Junaid with Truist followed by Matt with Goldman Sachs.

Junaid Siddiqui: Yeah. Hey. Sorry. Can you hear me? Hey, guys. Hey. Can you hear me okay?

Dominic Phillips: Yeah. Let’s do Junaid first, then we’ll go to Matt.

Junaid Siddiqui: Great. Thanks, guys. You know, it seems like you’re continuing to add sales capacity and feel pretty confident about the significant opportunity going forward. But I just wanted to ask you how you’re looking at the growth versus profitability framework. Going forward.

Dominic Phillips: Yeah. I mean, both of them are important to us. We really focus on kind of balance both growth and profit. I think this was the fourth consecutive quarter we’ve been north of a rule of 40. And then, obviously, even within that, we were able to accelerate our net new ARR year-over-year growth at a larger scale and continue to grow really quickly as a result of the large customer momentum and the strong kind of land and expand quarter. And then the contribution of the emerging products in new frontiers. And so, you know, within the construct of wanting to kind of balance both growth and profitability, you know, being over rule of 40, we feel good about that, and then wanting to continue to try to make the investments to grow as fast as we can beyond that.

Junaid Siddiqui: Great. Thanks. And, Dom, just on the gross margin, you know, that continues to tick up. I know you’ve talked about that, you know, historically, that most of the margin improvement is gonna be below that line. But could you just call out some of the reasons for, you know, the strength there and, you know, if you can continue to sustain that?

Dominic Phillips: Yeah. It comes really across our entire cog stack. And, you know, I think we’re up kind of one percentage point year over year. So not a lot of leverage. And I think, you know, going from here, we feel good with where, you know, gross margins are and expect much more of the leverage to come from, you know, from the other OpEx line items. But in terms of supply chain and inventory efficiencies, you know, cloud and cellular efficiencies. You know, more leverage out of customer support. All of those kind of line items within COGS are getting a little bit more efficient year over year, and you know, we feel good with those results.

Junaid Siddiqui: Great. Thank you.

Mike Chang: The next question comes from Matt with Goldman Sachs followed by Andrew with BNP.

Matt Hedberg: Hey, guys. This is Matt on for Kash. Sanjit, maybe going back to the emerging product net new ACV strength in the quarter. You flagged contributions from a few of the announcements from beyond 25 asset maintenance, AI multicam, commercial nav. These products have only been in market for a couple of months. I’m curious if you expected this level of momentum this early into the launch and how this may inform your view on emerging product net new ACV contributions looking ahead? Thanks.

Sanjit Biswas: Yeah. I would say, Matt, we’re a number of these customers that purchased in the quarter, they had been design partners with us. They’re going much bigger with it. So it’s exciting to see that they’re ready to go and that the products are working for them at scale. I do think every product has a natural revenue ramp that takes the number of quarters, and we plan to continue enhancing these products over the next couple of quarters too. It’s not just that this is the release and that’s it. So we’re gonna keep investing. We’re gonna, you know, keep getting more trials in action, but we are very pleased with that initial we’re seeing from the customer base.

Matt Hedberg: Awesome. Thanks a lot.

Mike Chang: Great. The next question comes from Andrew at BNP followed by Mark with Loop Capital.

Andrew DeGasperi: Thanks for fitting me in. I’d just like a looking at your net new customers that you added over a 100k, looking how it trended relative to last year, while still good, I noticed it slowed down slightly. Just wondering, is this a function of the fact that you’re landing larger customers? Or am I missing something?

Dominic Phillips: Yeah. I would say, you know, overall, it was a really strong large customer quarter. The 100k plus ARR customers are now doing, you know, about a billion dollars of ARR 35% year over year. They’re contributing 59% of the overall ARR, which is up from 57% last year. So this is clearly our fastest growing cohort. Think it’s important to consider, you know, the ARR, the growth rates, the ARR mix, not just the customer accounts. But beyond that, we obviously added a quarterly record $171 million dollar plus ARR customers, and that’s becoming more meaningful to our results as well.

Andrew DeGasperi: Thanks. And then one on the R&D. Just wondering if in terms of this quarter was would you expect this to continue to grow at the consistent rate or is there something, like, in terms of efficiency that we achieved on that? That makes it a driver of operating leverage going forward?

Dominic Phillips: I think R&D is gonna continue to be one of our big areas of investment. We’re obviously really focused on adding AI throughout the platform. And in all of the products, and then the pace of innovation and products that we’ve announced over the last couple of years has really picked up, you know, requires a lot of R&D investment. So I don’t expect it to materially decrease in terms of the, you know, the overall leverage, but I also don’t expect it to be an area where we’re gonna start to see the percentage of revenue go in the opposite direction as well.

Andrew DeGasperi: Thanks.

Mike Chang: The next question comes from Mark with Loop Capital followed by Alexei with JPMorgan.

Mark Schappel: Hi. Thank you for taking my question. Sanjit, the number of products the company sells has increased meaningfully during the past year or so. Which can often, complicate the selling process. Could you just discuss a little bit about how you’ve adapted, your selling process to accommodate all the new products?

Sanjit Biswas: Sure. You know, I would say, again, we focus on the value of the platform. We really want to understand our customers’ operations. Typically speaking, they’ll have vehicles, and so safety and telematics will be lead products. And those are products that I think the market is generally familiar with. But along the way, they’ll discover that, hey. There’s an opportunity to improve training. For a lot of these frontline workers or, you know, maybe there’s a maintenance opportunity. So, really, we try to, again, show our customers the entire platform. We do a lot of demos where they’re able to see the breadth of what we offer and many times the customers will self-select and say, hey. Actually have a lot of construction equipment in my business or, we’re really trying to think through how we do commercial navigation because we have an issue with hazmat or bridge strikes and all these kind of real-world problems.

So I view it as, rather than focusing on selling products, really understand the customer’s operations, their environment, and then work backward from that. And I think our sales team does a great job of really kind of engaging in that level.

Mark Schappel: Great. Thanks. And then, Dominic, could you just discuss the hiring that took place in the quarter just remind us of how you’re thinking about hiring for the balance of the year?

Dominic Phillips: Yeah. I think, you know, what we’ve disclosed is that after two years of really elevated hiring growth that we are going into this year, we’re still adding more headcount, but at a lower rate than what we had to do over the last two years to kind of catch up. We’re on track to do that. So kind of the that we set out at the beginning of the year, we’re on track with that. And expect to continue to add more headcount into the back half of the year as well.

Mark Schappel: Thank you.

Mike Chang: Great. Our last question today comes from Alexei with JPMorgan.

Ella Smith: Hi. This is Ella Smith on for Alexei Gogolev. Thank you so much for taking our questions. So first, I was hoping to ask about landing new customers as that is a focus for you. Are you primarily landing these new customers through telematics and video-based safety, or is it becoming more common to land customers via a non-fleet solution?

Dominic Phillips: Yeah. It’s definitely becoming more common. I think we called out the number of new logos that added, you know, two or more or three more products in the prepared remarks. The majority of the largest new logos. And then we give a number of examples of the products that customers are adopting. So that is becoming increasingly more common. Customers often will land with video-based safety and vehicle telematics, but increasingly, we’re seeing, you know, monitoring in a number of the newer emerging products that we’ve announced over the last couple of years land in the initial transaction.

Ella Smith: Got it. Thank you, Dominic. And, for my follow-up, your experience strength in the construction segment for some time now despite the macro data for that industry being somewhat weak. I was curious if you could shed some light on your conversation with your construction customers.

Sanjit Biswas: Yeah. I’ll take that one. I think it’s important to understand the construction industry and the context they’re coming from. These are customers where they have very asset and labor-intensive operations for them to get deep visibility which assets are being used and how much and if they’re operating safely, if they can find labor efficiencies. It makes a really big difference in their operations. This is also an industry that’s relatively early in the digitization journey. Most of that yellow iron equipment that you see at job sites isn’t well tracked and doesn’t have real-time telematics or video safety on it. Most of the small tools that you’ll see at a construction site don’t have any kind of tracking on them. So there’s a lot of greenfield opportunity. It’s a market that is starting to really wake up to the value of technology, and it’s complex. So they have to digest it over time, but we’re excited about what we’re seeing.

Ella Smith: Great. Thank you, Sanjit.

Mike Chang: So this concludes the question and answer portion. Thank you all for attending your Q2 fiscal year 2026 earnings call. Before I let you go, have a few short announcements. We’ll be attending the Goldman Sachs Communicorpio Conference in San Francisco on September 8, the Wolf Technology Conference in San Francisco on September 10, the Piper Sandler Growth Frontiers Conference in Nashville on September 10, and the Evercore bus tour on September 17. We hope to see you at one of these events. That’s it for today’s meeting. If you have any follow-up questions, you can email us at ir@samsara.com. Bye, everyone.