Actuals vs. estimates
No consensus comparison available for this event.
Verdict
- Revenue of $232.8 million grew 35% year over year, with gross booking volume up 45% to $3.0 billion and payment volume up 34% to $1.3 billion.
- Full-year FY2027 revenue guidance was raised to $927-$933 million, +32% at the midpoint, and non-GAAP income from operations to $82-$86 million, with the 9% non-GAAP operating margin reaffirmed.
- Non-GAAP income from operations doubled to $17.3 million while the GAAP operating loss widened to $(25.6) million from $(12.3) million.
- The one thing that matters: the whole distance between those two operating lines is stock compensation, and it is growing faster than revenue.
Key metrics
| Metric | Reported | Prior year | Change |
|---|---|---|---|
| Gross Booking Volume | $3.0bn | — | +45% YoY |
| Payment Volume | $1.3bn | — | +34% YoY |
| New signed GBV (SLG, TTM) | $4.0bn | — | +60% YoY |
| GAAP gross margin | 74% | 73% | +1 pt |
| Non-GAAP income from operations | $17.3m | $8.4m | +105% |
| Free cash flow | $21.5m | $(4.1)m | — |
Guidance changes
| Item | New guidance | Prior guidance |
|---|---|---|
| Q3 FY2027 total revenue | $253 - $255 million, +30% YoY at the midpoint | — |
| Q3 FY2027 non-GAAP income from operations | $35.5 - $36.5 million, 14% non-GAAP operating margin at the midpoint | — |
| FY2027 total revenue | $927 - $933 million, +32% YoY at the midpoint (raised) | — |
| FY2027 non-GAAP income from operations | $82 - $86 million (raised) | — |
| FY2027 non-GAAP operating margin | 9% at the midpoint (reaffirmed) | — |
Quality of earnings
- The profitability claim is an add-back. Non-GAAP income from operations of $17.3 million is reached by excluding $43.3 million of stock compensation-related charges plus $2.4 million of severance, restructuring and intangible amortization, and by adding back a $2.2 million gain on the sale of property and equipment.
- Cash generation leans on working capital. Free cash flow of $21.5 million against $(4.1) million a year ago came with a $13.4 million release from corporate card receivables and a $10.2 million accounts receivable inflow, against $15.7 million spent on contract acquisition costs.
- The narrower net loss is a financing story. Net loss improved to $(29.1) million from $(38.6) million mainly because interest expense fell to $2.9 million from $15.6 million and the prior year's $7.8 million fair-value loss did not repeat.
Gotchas & watch items
- Q3 revenue guidance of $253-$255 million implies 30% growth at the midpoint against the 35% delivered in Q2, and the release does not explain the step down.
- Growth is partly bought: Navan acquired Smartrips in Brazil and BoomPop, and the release does not disclose their contribution to the 35% growth rate.
- Payment volume grew 34% against 45% GBV growth, so card attach is losing ground to bookings.
- Stock compensation-related charges of $43.3 million more than doubled from $19.3 million on 35% revenue growth, and sales and marketing spend rose to $104.6 million from $68.5 million.