IOT 10-Q
Samsara Inc. (IOT)
10-Q
2026-09-08
For: 2026-08-01
View Original
Added on
September 08, 2026
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
| QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the quarterly period ended August 1, 2026
OR
| TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from ________ to ________
Commission File Number: 001-41140
(Exact name of registrant as specified in its charter)
| (State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||
| (Address of principal executive offices, including zip code) | ||||||||
(415 ) 985-2400
(Registrant’s telephone number, including area code)
| Not Applicable | ||
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
| Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||||||||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No o
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes x No o
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
x | Accelerated filer | o | |||||||||
| Non-accelerated filer | o | Smaller reporting company | |||||||||
Emerging growth company | |||||||||||
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes o No x
As of September 1, 2026, there were 380,273,036 shares of the registrant’s Class A common stock, 205,332,173 shares of the registrant’s Class B common stock, and no shares of the registrant’s Class C common stock, each with a $0.0001 par value per share, outstanding.
TABLE OF CONTENTS
| Page | ||||||||
1
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
This Quarterly Report on Form 10-Q contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”). All statements other than statements of historical facts contained in this Quarterly Report on Form 10-Q are forward-looking statements. In some cases, you can identify forward-looking statements by terminology such as “anticipate,” “believe,” “contemplate,” “continue,” “could,” “estimate,” “expect,” “goal,” “intend,” “may,” “objective,” “ongoing,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or the negative of these terms or other comparable expressions that concern our expectations, strategies, plans, or intentions.
Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:
•our future financial performance, including our expectations regarding our revenue, cost of revenue, operating expenses, other key business metrics and non-GAAP financial measures, our ability to determine reserves, and our ability to maintain future profitability;
•the sufficiency of our cash, cash equivalents, and investments to meet our liquidity needs;
•our expectations regarding future dividend payments or issuances of additional capital stock;
•our ability to develop new products, features, integrations, and enhancements for our Connected Operations Platform (our “solution”);
•our ability to compete with existing and new competitors in existing and new markets and offerings;
•our ability to attract, retain, and expand our relationships with customers;
•our and our customers’ expectations regarding the benefits of our solution;
•our ability to maintain the security and availability of our solution and business systems;
•our expectations regarding the effects and enforcement of existing and developing laws and regulations, including with respect to taxation, trade (including tariff) policies, privacy and data protection, and the outcomes of litigation that we are or may become subject to from time to time;
•our expectations regarding the effects of geopolitical and macroeconomic events, including geopolitical tensions and conflicts, changes to monetary, fiscal, and trade (including tariff) policies, financial distress caused by bank failures, the impact of political elections in the United States and abroad, global supply chain challenges, foreign currency fluctuations, elevated inflation and interest rates, and the emergence of public health crises, on our and our customers’ and partners’ respective businesses;
•our ability to successfully execute on strategic initiatives and manage risk associated with our business, including as we expand the scope of our business;
•our expectations regarding international expansion efforts;
•our expectations regarding our market opportunities and the evolution and growth of these markets and competition within these markets;
•our ability to develop and protect our brand;
•our expectations and management of future growth;
•our ability to hire, retain, and develop our employees;
•our expectations concerning relationships with third parties;
•our ability to successfully acquire and integrate companies and assets;
•our expectations regarding the adoption of accounting pronouncements;
•our ability to maintain, protect, and enhance our intellectual property; and
•our anticipated tax withholding and remittance obligations in connection with restricted stock unit settlements.
Samsara Inc. (the “Company,” “Samsara,” “our,” or “we”) cautions you that the foregoing list does not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.
2
You should not rely upon forward-looking statements as predictions of future events. We have based the forward-looking statements contained in this Quarterly Report on Form 10-Q primarily on our current expectations, estimates, forecasts, and projections about future events and trends that we believe may affect our business, financial condition, results of operations, and prospects. Although we believe that we have a reasonable basis for each forward-looking statement contained in this Quarterly Report on Form 10-Q, we cannot guarantee that the outcome, future results, or levels of activity, growth, and performance reflected in the forward-looking statements will be achieved, or that the events and circumstances reflected in the forward-looking statements will occur. The outcome of the events described in the forward-looking statements is subject to risks, uncertainties, and other factors, including the updated risks and uncertainties described in the section titled “Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q, as well as those described in the section titled “Risk Factors” and elsewhere in our Annual Report on Form 10-K filed with the Securities and Exchange Commission (“SEC”) on March 16, 2026, as supplemented by our subsequent quarterly reports on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks and uncertainties emerge from time to time, and it is not possible for us to predict all risks and uncertainties that could have an impact on the forward-looking statements contained in this Quarterly Report on Form 10-Q. Additionally, changes and volatility in political, economic, or industry conditions, the interest rate environment, or financial and capital markets could result in changes in demand for products or services. The results, events, and circumstances reflected in the forward-looking statements may not occur, and actual results, events, or circumstances could differ materially from those described in the forward-looking statements.
The forward-looking statements contained in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are first made available. We undertake no obligation to update any forward-looking statements made in this Quarterly Report on Form 10-Q to reflect events or circumstances after the date of this Quarterly Report on Form 10-Q or to reflect new information or the occurrence of unanticipated events, except as required by law. We may not actually achieve the plans, intentions, or expectations disclosed in our forward-looking statements, and you should not place undue reliance on our forward-looking statements. Our forward-looking statements do not reflect the potential impact of any future acquisitions, mergers, dispositions, joint ventures, or investments we may make.
In addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These statements are based upon information available to us as of the date of this Quarterly Report on Form 10-Q, and while we believe such information forms a reasonable basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain, and investors are cautioned not to unduly rely upon these statements.
You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed as exhibits to this Quarterly Report on Form 10-Q in conjunction with other documents that we file with the SEC and with the understanding that our actual future results may be materially different from what we expect. We qualify all of the forward-looking statements in this Quarterly Report on Form 10-Q by these cautionary statements.
Available Information
Our website address is located at samsara.com and our investor relations website is located at investors.samsara.com. We electronically file our annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act with the SEC. We make copies of these reports and other information available on our investor relations website, free of charge, as soon as reasonably practicable after we electronically file such material with, or furnish it to, the SEC.
We announce material information to the public about us, our products, and other matters through a variety of means, including filings with the SEC, press releases, public conference calls, webcasts, our investor relations website, our corporate website (www.samsara.com), our corporate blog (www.samsara.com/blog), and our and our executives’ social media accounts in order to achieve broad, non-exclusionary distribution of information to the public and to comply with our disclosure obligations under Regulation FD. Except as expressly set forth in this Quarterly Report on Form 10-Q, the contents of our websites are not incorporated by reference into, or otherwise to be regarded as part of, this report or any other report or document we file with the SEC, and any references to our websites are intended to be inactive textual references only.
The information disclosed by the foregoing channels could be deemed to be material information. As such, we encourage investors, the media, and others to follow the channels listed above and review the information disclosed through such channels.
3
PART I—FINANCIAL INFORMATION
Item 1. Financial Statements (Unaudited)
4
SAMSARA INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(In thousands, except share data)
(Unaudited)
| As of | |||||||||||
| August 1, 2026 | January 31, 2026 | ||||||||||
| Assets | |||||||||||
| Current assets: | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Short-term investments | |||||||||||
| Accounts receivable, net | |||||||||||
| Inventories | |||||||||||
| Connected device costs, current | |||||||||||
| Deferred commissions, current | |||||||||||
| Prepaid expenses and other current assets | |||||||||||
| Total current assets | |||||||||||
| Long-term investments | |||||||||||
| Property and equipment, net | |||||||||||
| Operating lease right-of-use assets | |||||||||||
| Connected device costs, non-current | |||||||||||
| Deferred commissions, non-current | |||||||||||
| Other assets | |||||||||||
| Total assets | $ | $ | |||||||||
| Liabilities and stockholders’ equity | |||||||||||
| Current liabilities: | |||||||||||
| Accounts payable | $ | $ | |||||||||
| Accrued expenses and other current liabilities | |||||||||||
| Accrued compensation and benefits | |||||||||||
| Deferred revenue, current | |||||||||||
| Operating lease liabilities, current | |||||||||||
| Total current liabilities | |||||||||||
| Deferred revenue, non-current | |||||||||||
| Operating lease liabilities, non-current | |||||||||||
| Other liabilities | |||||||||||
| Total liabilities | |||||||||||
| Commitments and contingencies (Note 9) | |||||||||||
| Stockholders’ equity: | |||||||||||
Preferred stock, $ | |||||||||||
Class A common stock, $ | |||||||||||
Class B common stock, $ | |||||||||||
Class C common stock, $ | |||||||||||
| Additional paid-in capital | |||||||||||
| Accumulated other comprehensive income (loss) | ( | ||||||||||
| Accumulated deficit | ( | ( | |||||||||
| Total stockholders’ equity | |||||||||||
| Total liabilities and stockholders’ equity | $ | $ | |||||||||
See accompanying notes to condensed consolidated financial statements.
5
SAMSARA INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS)
(In thousands, except share and per share data)
(Unaudited)
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Revenue | $ | $ | $ | $ | |||||||||||||||||||
| Cost of revenue | |||||||||||||||||||||||
| Gross profit | |||||||||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Sales and marketing | |||||||||||||||||||||||
| General and administrative | |||||||||||||||||||||||
| Total operating expenses | |||||||||||||||||||||||
| Income (loss) from operations | ( | ( | |||||||||||||||||||||
| Interest income and other income, net | |||||||||||||||||||||||
| Income (loss) before provision for income taxes | ( | ( | |||||||||||||||||||||
| Provision for income taxes | |||||||||||||||||||||||
| Net income (loss) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Other comprehensive income (loss): | |||||||||||||||||||||||
| Foreign currency translation adjustments, net of tax | |||||||||||||||||||||||
| Unrealized gains (losses) on investments, net of tax | ( | ( | |||||||||||||||||||||
| Total other comprehensive income (loss): | ( | ( | |||||||||||||||||||||
| Comprehensive income (loss) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Basic and diluted net income (loss) per share: | |||||||||||||||||||||||
| Net income (loss) per share, basic and diluted | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Weighted-average shares used in computing net income (loss) per share, basic | |||||||||||||||||||||||
| Weighted-average shares used in computing net income (loss) per share, diluted | |||||||||||||||||||||||
See accompanying notes to condensed consolidated financial statements.
6
SAMSARA INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY
(In thousands, except share data)
(Unaudited)
| Three Months Ended August 1, 2026 | |||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||
| Balance at May 2, 2026 | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||
| Issuance of common stock from equity compensation plans | — | — | — | ||||||||||||||||||||||||||||||||
| Shares withheld for net share settlement of equity awards | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance at August 1, 2026 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Three Months Ended August 2, 2025 | |||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||
| Balance at May 3, 2025 | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||
| Issuance of common stock from equity compensation plans | — | — | — | ||||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Balance at August 2, 2025 | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||
7
SAMSARA INC.
CONDENSED CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY—CONTINUED
(In thousands, except share data)
(Unaudited)
| Six Months Ended August 1, 2026 | |||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||
| Balance at January 31, 2026 | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||
| Issuance of common stock from equity compensation plans | — | — | — | ||||||||||||||||||||||||||||||||
| Shares withheld for net share settlement of equity awards | ( | — | ( | — | — | ( | |||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive loss | — | — | — | ( | — | ( | |||||||||||||||||||||||||||||
| Net income | — | — | — | — | |||||||||||||||||||||||||||||||
| Balance at August 1, 2026 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Six Months Ended August 2, 2025 | |||||||||||||||||||||||||||||||||||
| Common Stock | Additional Paid-In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Total Stockholders’ Equity | |||||||||||||||||||||||||||||||
| Shares | Amount | ||||||||||||||||||||||||||||||||||
| Balance at February 1, 2025 | $ | $ | $ | ( | $ | ( | $ | ||||||||||||||||||||||||||||
| Issuance of common stock from equity compensation plans | — | — | — | ||||||||||||||||||||||||||||||||
| Stock-based compensation expense | — | — | — | — | |||||||||||||||||||||||||||||||
| Other comprehensive income | — | — | — | — | |||||||||||||||||||||||||||||||
| Net loss | — | — | — | — | ( | ( | |||||||||||||||||||||||||||||
| Balance at August 2, 2025 | $ | $ | $ | $ | ( | $ | |||||||||||||||||||||||||||||
See accompanying notes to condensed consolidated financial statements.
8
SAMSARA INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In thousands)
(Unaudited)
| Six Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Operating activities | |||||||||||
| Net income (loss) | $ | $ | ( | ||||||||
| Adjustments to reconcile net income (loss) to net cash provided by operating activities | |||||||||||
| Depreciation and amortization | |||||||||||
| Stock-based compensation expense | |||||||||||
| Net accretion of discounts on investments | ( | ( | |||||||||
| Other | ( | ||||||||||
| Changes in operating assets and liabilities: | |||||||||||
| Accounts receivable, net | ( | ( | |||||||||
| Inventories | ( | ( | |||||||||
| Prepaid expenses and other current assets | ( | ||||||||||
| Arbitration award receivable | ( | ||||||||||
| Connected device costs | ( | ( | |||||||||
| Deferred commissions | ( | ( | |||||||||
| Other assets | ( | ||||||||||
| Accounts payable and other liabilities | ( | ||||||||||
| Deferred revenue | |||||||||||
| Operating lease liabilities | |||||||||||
| Net cash provided by operating activities | |||||||||||
| Investing activities | |||||||||||
| Purchases of property and equipment | ( | ( | |||||||||
| Purchases of investments | ( | ( | |||||||||
| Proceeds from maturities and redemptions of investments | |||||||||||
| Other investing activities | ( | ||||||||||
| Net cash used in investing activities | ( | ( | |||||||||
| Financing activities | |||||||||||
| Proceeds from issuance of common stock from equity compensation plans | |||||||||||
| Taxes paid for net share settlement of equity awards | ( | ||||||||||
| Other financing activities | ( | ( | |||||||||
| Net cash provided by (used in) financing activities | ( | ||||||||||
| Effect of foreign exchange rate changes on cash, cash equivalents, and restricted cash | ( | ||||||||||
| Net increase (decrease) in cash, cash equivalents, and restricted cash | ( | ||||||||||
| Cash, cash equivalents, and restricted cash, beginning of period | |||||||||||
| Cash, cash equivalents, and restricted cash, end of period | $ | $ | |||||||||
| Supplemental disclosure of cash flow information | |||||||||||
| Cash paid for income taxes, net of refunds | $ | $ | |||||||||
| Supplemental disclosure of non-cash investing and financing activities | |||||||||||
| Property and equipment accrued but not yet paid | $ | $ | |||||||||
| Reconciliation of cash, cash equivalents, and restricted cash | |||||||||||
| Cash and cash equivalents | $ | $ | |||||||||
| Restricted cash—included in Prepaid expenses and other current assets | |||||||||||
| Total cash, cash equivalents, and restricted cash | $ | $ | |||||||||
See accompanying notes to condensed consolidated financial statements.
9
SAMSARA INC.
NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. Description of Business
Samsara Inc. (“Samsara”) and its subsidiaries (collectively, the “Company”) are the pioneers of the Connected Operations Platform, which is an open platform that connects the people, assets, and systems of some of the world’s most complex operations, allowing them to develop actionable insights and improve their operations. Samsara was incorporated in Delaware in 2015 as Samsara Networks Inc. and changed its name to Samsara Inc. in February 2021. On June 1, 2026, the Company completed its conversion from a corporation organized under the laws of the State of Delaware to a corporation organized under the laws of the State of Nevada. Samsara’s principal executive offices are located at 1 De Haro Street, San Francisco, California 94107.
2. Summary of Significant Accounting Policies
Basis of Presentation and Fiscal Year—The accompanying unaudited condensed consolidated financial statements have been prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”) and applicable rules and regulations of the U.S. Securities and Exchange Commission (“SEC”) regarding interim financial reporting. Accordingly, they do not include all disclosures normally required in annual consolidated financial statements prepared in accordance with GAAP. Therefore, these unaudited condensed consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the fiscal year ended January 31, 2026, which was filed with the SEC on March 16, 2026.
In management’s opinion, these unaudited condensed consolidated financial statements have been prepared on the same basis as the annual financial statements and reflect all adjustments, which include normal recurring adjustments necessary for the fair statement, except as disclosed herein, of the Company’s financial position as of August 1, 2026 and the results of operations for the three and six months ended August 1, 2026 and August 2, 2025, and cash flows for the six months ended August 1, 2026 and August 2, 2025. The condensed consolidated balance sheet as of January 31, 2026 was derived from the audited consolidated financial statements but does not include all disclosures required by GAAP. The results of operations for the three and six months ended August 1, 2026 are not necessarily indicative of the results to be expected for the full year or any other future interim or annual period.
The Company’s fiscal year is a 52- or 53-week period ending on the Saturday closest to February 1. Every sixth fiscal year is a 53-week year. Fiscal year 2030 is the Company’s next 53-week fiscal year, with the fourth quarter consisting of 14 weeks. Fiscal year 2027 consists of 52 weeks and fiscal year 2026 consisted of 52 weeks.
Principles of Consolidation—The condensed consolidated financial statements include the accounts of Samsara and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated in consolidation.
Certain prior period balance sheet amounts have been combined into other line items to conform to current period presentation. These reclassifications had no effect on total assets, total liabilities, or stockholders’ equity.
Use of Estimates—The preparation of condensed consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes. Such management estimates include, but are not limited to, the period of benefit for connected device costs and deferred commissions, collectability of receivables, inventory valuation, capitalization and useful lives of internal-use software costs, timing and amount of legal contingencies, and valuation of deferred income taxes and uncertain tax positions. Actual results could materially differ from the estimates and assumptions made.
Significant Accounting Policies—There were no material changes to the Company’s significant accounting policies during the six months ended August 1, 2026.
Recently Adopted Accounting Pronouncement—In July 2025, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) No. 2025-05, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses for Accounts Receivable and Contract Assets. This standard provides a practical expedient for calculating current expected credit losses for current accounts receivable and current contract assets by assuming that the current conditions as of the balance sheet date will not change for the remaining life of the asset. The Company adopted ASU 2025-05, effective February 1, 2026, on a prospective basis and elected the practical expedient. The adoption did not have a material impact on the Company’s condensed consolidated financial statements.
10
Recent Accounting Pronouncements Not Yet Adopted—In November 2024, the FASB issued ASU No. 2024-03, Income Statement—Reporting Comprehensive Income—Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses. This standard requires disclosure of specified information about certain costs and expenses, including purchases of inventory, employee compensation, depreciation, and amortization. As clarified on the subsequent amendment, ASU No. 2025-01, issued by the FASB in January 2025, this guidance is effective for the Company’s Annual Report on Form 10-K for the fiscal year ending January 29, 2028, and subsequent interim periods. Early adoption is permitted and may be applied either prospectively or retrospectively. The Company is currently evaluating the impact of this ASU on its consolidated financial statements.
In September 2025, the FASB issued ASU No. 2025-06, Intangibles—Goodwill and Other—Internal-Use Software (Subtopic 350-40): Targeted Improvements to the Accounting for Internal-Use Software, which modernizes the accounting for internal-use software. ASU 2025-06 removes all references to software development stages and requires capitalization of software costs when management has committed to the software project and it is probable the software will be completed and perform its intended use. This guidance is effective for the Company for its fiscal year beginning January 30, 2028, and interim periods within that fiscal year. Early adoption is permitted. The Company is currently evaluating the impact of this ASU on its consolidated financial statements.
In December 2025, the FASB issued ASU No. 2025-11, Interim Reporting (Topic 270): Narrow-Scope Improvements. This standard enhances consistency in interim reporting for all entities by clarifying interim disclosure requirements and the form and content of interim financial statements in accordance with GAAP. This guidance is effective for the Company for its fiscal year beginning January 30, 2028, and interim periods within that fiscal year. Early adoption is permitted and must be applied either prospectively or retrospectively to any or all prior periods presented in the financial statements. The Company is currently evaluating the impact of this ASU on its consolidated financial statements.
3. Investments
The following is a summary of available-for-sale marketable debt securities recorded within short-term and long-term investments on the condensed consolidated balance sheets (in thousands):
| As of | |||||||||||||||||||||||
| August 1, 2026 | |||||||||||||||||||||||
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||||||||||
| Investments | |||||||||||||||||||||||
Commercial paper | $ | $ | $ | $ | |||||||||||||||||||
Corporate notes and bonds | ( | ||||||||||||||||||||||
U.S. government, agency, and municipal securities | ( | ||||||||||||||||||||||
| Total investments | $ | $ | $ | ( | $ | ||||||||||||||||||
| As of | |||||||||||||||||||||||
| January 31, 2026 | |||||||||||||||||||||||
| Amortized Cost | Gross Unrealized Gains | Gross Unrealized Losses | Estimated Fair Value | ||||||||||||||||||||
| Investments | |||||||||||||||||||||||
Commercial paper | $ | $ | $ | $ | |||||||||||||||||||
Corporate notes and bonds | ( | ||||||||||||||||||||||
U.S. government and agency securities | ( | ||||||||||||||||||||||
| Total investments | $ | $ | $ | ( | $ | ||||||||||||||||||
11
The Company included $8.1 million and $6.5 million of accrued interest receivable in “” on the condensed consolidated balance sheets as of August 1, 2026 and January 31, 2026, respectively. The Company did not recognize an allowance for credit losses against accrued interest receivable as of August 1, 2026 and January 31, 2026 because such potential losses were not material.
For available-for-sale marketable debt securities with unrealized loss positions, the Company does not intend to sell any of the securities and considers it more likely than not that these securities will be held until recovery of their cost basis. The unrealized losses are attributable to changes in interest rates and market conditions and are not the result of credit deterioration of the underlying issuers. Accordingly, the Company did not recognize an allowance for credit losses on these securities as of August 1, 2026 and January 31, 2026.
As of August 1, 2026, the estimated fair values of available-for-sale marketable debt securities, by remaining contractual maturity, are as follows (in thousands):
| As of | |||||
| August 1, 2026 | |||||
| Due within one year | $ | ||||
| Due in one year to three years | |||||
| Total | $ | ||||
Concentrations of Credit Risk—The Company maintains its investments in marketable debt securities with high-quality financial institutions with investment-grade ratings.
4. Fair Value Measurements
The Company reports financial assets and liabilities and nonfinancial assets and liabilities that are recognized or disclosed at fair value in the condensed consolidated financial statements on a recurring basis, using a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to measurements involving significant unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy are as follows:
Level 1—Observable inputs that reflect quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2—Observable inputs other than quoted prices in active markets for identical assets or liabilities, quoted prices for identical or similar assets or liabilities in inactive markets, or other inputs that are observable or can be corroborated by observable market data for substantially the full term of the assets or liabilities.
Level 3—Inputs that are generally unobservable and typically reflect management’s estimates of assumptions that market participants would use in pricing the asset or liability.
The level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest-level input that is significant to the fair value measurement in its entirety.
12
The following tables present the fair value hierarchy for assets measured at fair value on a recurring basis as of the periods presented (in thousands):
| As of August 1, 2026 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Cash equivalents | |||||||||||||||||||||||
| Money market funds | $ | $ | $ | $ | |||||||||||||||||||
| Commercial paper | |||||||||||||||||||||||
| U.S. government and agency securities | |||||||||||||||||||||||
| Total cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Marketable debt securities | |||||||||||||||||||||||
Commercial paper | $ | $ | $ | $ | |||||||||||||||||||
Corporate notes and bonds | |||||||||||||||||||||||
U.S. government, agency, and municipal securities | |||||||||||||||||||||||
| Total marketable debt securities | $ | $ | $ | $ | |||||||||||||||||||
| As of January 31, 2026 | |||||||||||||||||||||||
| Level 1 | Level 2 | Level 3 | Total | ||||||||||||||||||||
| Cash equivalents | |||||||||||||||||||||||
| Money market funds | $ | $ | $ | $ | |||||||||||||||||||
| Commercial paper | |||||||||||||||||||||||
| U.S. government and agency securities | |||||||||||||||||||||||
| Total cash equivalents | $ | $ | $ | $ | |||||||||||||||||||
| Marketable debt securities | |||||||||||||||||||||||
Commercial paper | $ | $ | $ | $ | |||||||||||||||||||
Corporate notes and bonds | |||||||||||||||||||||||
U.S. government and agency securities | |||||||||||||||||||||||
| Total marketable debt securities | $ | $ | $ | $ | |||||||||||||||||||
The Company determines the fair value of its security holdings based on pricing from service providers and market prices from industry-standard independent data providers. Such market prices may be quoted prices in active markets for identical assets (Level 1 inputs) or pricing determined using inputs other than quoted prices that are observable either directly or indirectly (Level 2 inputs), such as yield curves, volatility factors, credit spreads, default rates, loss severity, current market and contractual prices for the underlying instruments or debt, broker and dealer quotes, as well as other relevant economic measures.
5. Costs to Obtain and Fulfill a Contract
Deferred Commissions—Total deferred commissions as of August 1, 2026 and January 31, 2026 were $294.3 million and $261.9 million, respectively.
The following table provides the amounts capitalized and amortized for commission costs for the periods presented (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Capitalized commission costs | $ | $ | $ | $ | |||||||||||||||||||
| Amortization expense | $ | $ | $ | $ | |||||||||||||||||||
Connected Devices—Total connected device costs, current and non-current, as of August 1, 2026 and January 31, 2026 were $489.5 million and $440.1 million, respectively. Amounts include deployed long-lived device assets that transfer ownership to the customer at the end of the contract, net of amortization, of $7.1 million and $8.1 million as of August 1, 2026 and January 31, 2026, respectively.
13
The following table provides the amounts capitalized and amortized for connected device costs for the periods presented (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Capitalized connected device costs | $ | $ | $ | $ | |||||||||||||||||||
| Amortization expense | $ | $ | $ | $ | |||||||||||||||||||
6. Balance Sheet Components
Inventories—Inventories comprise the following (in thousands):
| As of | |||||||||||
| August 1, 2026 | January 31, 2026 | ||||||||||
| Raw materials | $ | $ | |||||||||
| Finished goods | |||||||||||
| Total inventories | $ | $ | |||||||||
Property and Equipment, Net—Property and equipment, net, comprises the following (in thousands):
| As of | |||||||||||
| August 1, 2026 | January 31, 2026 | ||||||||||
| Gross property and equipment: | |||||||||||
| Computers and equipment | $ | $ | |||||||||
| Leasehold improvements | |||||||||||
| Furniture and fixtures | |||||||||||
| Internal-use software costs | |||||||||||
| Total gross property and equipment | |||||||||||
| Accumulated depreciation and amortization | ( | ( | |||||||||
| Property and equipment, net | $ | $ | |||||||||
Internal-use software costs included $2.9 million and $5.4 million of capitalized stock-based compensation expense for the three and six months ended August 1, 2026, respectively, and $2.3 million and $4.1 million of capitalized stock-based compensation expense for the three and six months ended August 2, 2025, respectively.
Depreciation and amortization of property and equipment was as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
Depreciation and amortization expense (1) | $ | $ | $ | $ | |||||||||||||||||||
__________
(1)Includes amortization of capitalized internal-use software costs of $5.2 million and $10.0 million for the three and six months ended August 1, 2026, respectively, and $3.3 million and $6.3 million for the three and six months ended August 2, 2025, respectively.
14
7. Revenue, Accounts Receivable, Deferred Revenue, and Remaining Performance Obligations
Revenue Recognition—Subscription revenue is generated from subscriptions to access the Connected Operations Platform. Subscription agreements contain multiple service elements for one or more of the cloud-based Applications via mobile app(s) or a website that enable data collection and provide access to the cellular network, generally one or more wireless gateways, cameras, sensors and other devices (collectively, “connected devices” or “Internet of Things (“IoT”) devices”), support services that are delivered over the term of the arrangement, and warranty coverage. The Connected Operations Platform and the related connected device access points are highly interdependent and interrelated, and represent a combined performance obligation, which is recognized over the related subscription period.
Other revenue is generally recognized at a point in time and is earned through the sale of replacement gateways, sensors and cameras, as well as related shipping and handling fees, and professional services.
Revenue comprises the following (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Subscription revenue | $ | $ | $ | $ | |||||||||||||||||||
| Other revenue | |||||||||||||||||||||||
| Total revenue | $ | $ | $ | $ | |||||||||||||||||||
Accounts Receivable—An allowance for credit losses of $14.0 million and $14.1 million was recorded as of August 1, 2026 and January 31, 2026, respectively. The Company recorded a charge of $3.7 million and $6.4 million, respectively, to general and administrative expenses during the three and six months ended August 1, 2026, compared to $1.7 million and $3.1 million, respectively, for the three and six months ended August 2, 2025. Additionally, write-offs against the allowance totaled $4.2 million and $6.5 million, respectively, during the three and six months ended August 1, 2026, compared to $2.4 million and $2.1 million, respectively, for the three and six months ended August 2, 2025.
Deferred Revenue—The following table provides the deferred revenue balances for the periods presented (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Deferred revenue, beginning of period | $ | $ | $ | $ | |||||||||||||||||||
| Deferred revenue, end of period | $ | $ | $ | $ | |||||||||||||||||||
Revenue recognized during the three and six months ended August 1, 2026, from the deferred revenue balance at the beginning of the respective periods was $412.9 million and $529.0 million, respectively, compared to $344.8 million and $440.9 million, respectively, for the three and six months ended August 2, 2025.
Remaining Performance Obligations (“RPO”)—RPO represents the amount of contracted future revenue that has not yet been recognized, including both deferred revenue and non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods.
As of August 1, 2026, the RPO was $4,285.2 million, of which the Company expects to recognize revenue of approximately $1,838.9 million over the next 12 months, with the remaining balance to be recognized thereafter.
Concentrations of Significant Customers and Credit Risk—No customer accounted for greater than 10% of total revenue for the three and six months ended August 1, 2026 and August 2, 2025.
No customer accounted for greater than 10% of total accounts receivable as of August 1, 2026 and January 31, 2026.
8. Leases
The Company leases office space under operating lease agreements that are non-cancelable and have remaining lease terms ranging from one year to approximately five years . The Company is required to pay property taxes, insurance, and normal maintenance costs for certain of these facilities.
15
Operating lease costs comprise the following (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Operating lease cost | $ | $ | $ | $ | |||||||||||||||||||
| Short-term lease cost | |||||||||||||||||||||||
| Sublease income | ( | ( | ( | ( | |||||||||||||||||||
| Total lease cost | $ | $ | $ | $ | |||||||||||||||||||
Supplemental information related to operating leases was as follows (in thousands, except for weighted-average data):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Cash paid for operating leases | $ | $ | $ | $ | |||||||||||||||||||
| Right-of-use assets obtained under new or modified operating leases | $ | $ | $ | $ | |||||||||||||||||||
| As of | |||||||||||
| August 1, 2026 | January 31, 2026 | ||||||||||
| Weighted-average remaining lease term (in years) | |||||||||||
| Weighted-average discount rate | |||||||||||
Future minimum lease payments included in the measurement of operating lease liabilities as of August 1, 2026 were as follows (in thousands):
| Fiscal Years Ending | Amount | |||||||
| Remainder of 2027 | $ | |||||||
| 2028 | ||||||||
| 2029 | ||||||||
| 2030 | ||||||||
| 2031 | ||||||||
| 2032 and thereafter | ||||||||
Total future minimum lease payments (1) | ||||||||
| Less: imputed interest | ( | |||||||
| Total operating lease liabilities | $ | |||||||
__________
(1)The contractual commitment amounts under operating leases in the table above are primarily related to leases for the corporate office facilities in San Francisco, California, as well as other offices for local operations.
9. Commitments and Contingencies
Purchase Commitments—Purchase commitments primarily consist of contractual arrangements for cellular, cloud hosting, and other subscription services.
In July 2026, the Company entered into a new agreement with its third-party cloud infrastructure provider, replacing its prior arrangement. Under the terms of this agreement, the Company has committed to purchase an aggregate of $900 million of cloud hosting services through July 2031. There were no material contractual obligations outside the ordinary course of business that were entered into by the Company during the six months ended August 1, 2026.
Letters of Credit—As of August 1, 2026 and January 31, 2026, the Company had $15.0 million and $15.8 million in letters of credit primarily issued to landlords for office spaces. These letters of credit renew annually and expire on various dates through 2031.
16
Litigation—From time to time, the Company has been and may become involved in various legal proceedings in the ordinary course of its business, including in proceedings initiated by the Company, and has been and may be subject to third-party intellectual property infringement claims. Such proceedings require significant financial and operational resources, including the diversion of management’s attention from the Company’s business objectives.
The Company continually evaluates uncertainties associated with litigation and records a charge equal to at least the minimum estimated liability for a loss contingency when both of the following conditions are met: (i) information available prior to issuance of the condensed consolidated financial statements indicates that it is probable that a liability has been incurred at the date of the condensed consolidated financial statements and (ii) the loss or range of loss can be reasonably estimated. If the Company determines that a loss is possible and a range of the loss can be reasonably estimated, the Company will disclose the range of the possible loss. The Company evaluates developments in legal matters that could affect the amount of liability that has been previously accrued, if any, and the matters and related ranges of possible losses disclosed and makes adjustments and changes to the disclosures, as appropriate. Significant judgment is required to determine both likelihood of there being, and the estimated amount of, a loss related to such matters. Until the final resolution of such matters, there may be an exposure to loss, and such amounts could be material. For legal proceedings for which there is a reasonable possibility of loss (meaning those losses for which the likelihood is more than remote but less than probable), the Company has determined there is no material exposure on an aggregate basis. The amounts recorded for losses deemed probable as of August 1, 2026 were also not material.
On February 3, 2026, in the matter of an arbitration of Samsara Inc. v. Motive Technologies, Inc., an award was rendered in favor of Samsara. The claims at issue arise from a complaint filed on January 24, 2024 by the Company and are for, among other things, breach of contract, fraud, unfair competition, and false advertising. As a result of the arbitration award, Samsara recognized a gain of $30.3 million in Interest income and other income, net during the three months ended May 2, 2026 and recorded the related receivable in Prepaid expenses and other current assets, and the receivable remains outstanding as of August 1, 2026. The Company is entitled to the recovery of reasonable attorneys’ fees, costs and other expenses incurred in connection with this arbitration.
Indemnification—In the normal course of business, the Company has agreed and may continue to agree to indemnify third parties with whom it enters into contractual relationships, including customers, lessors, and parties to other transactions with the Company, with respect to certain matters. The Company has agreed, under certain conditions, to hold these third parties harmless against specified losses, such as those arising from a breach of representations or covenants, claims that the Company’s products infringe the intellectual property rights of other parties, or other claims made against certain parties. It is not possible to determine the maximum potential amount of liability under these indemnification obligations due to the Company’s limited history of prior indemnification claims and the unique facts and circumstances that are likely to be involved in each particular claim.
10. Equity
The Company had reserved shares of common stock for future issuance as of August 1, 2026 and January 31, 2026, as follows:
| As of | |||||||||||
| August 1, 2026 | January 31, 2026 | ||||||||||
| 2015 Equity Incentive Plan: | |||||||||||
| Options outstanding | |||||||||||
| 2021 Equity Incentive Plan: | |||||||||||
Restricted stock units (“RSUs”) outstanding | |||||||||||
| Shares available for future grants | |||||||||||
| 2021 Employee Stock Purchase Plan: | |||||||||||
| Shares available for future issuance | |||||||||||
| Total shares of common stock reserved for future issuance | |||||||||||
17
Employee Compensation Plans
The Company currently has two equity incentive plans, the 2015 Equity Incentive Plan (the “2015 Plan”) and the 2021 Equity Incentive Plan (the “2021 Plan”). The 2015 Plan was terminated in connection with the adoption of the 2021 Plan in December 2021 but continues to govern the terms of outstanding stock options and RSUs that were granted prior to the termination of the 2015 Plan. The Company no longer grants equity awards pursuant to the 2015 Plan.
2021 Equity Incentive Plan—In December 2021, the Board of Directors adopted and stockholders approved the 2021 Plan, which became effective in December 2021 in connection with the Company’s initial public offering (“IPO”). The total number of shares of the Company’s Class A common stock reserved for future grants as of August 1, 2026 includes 29,035,779 shares added on the first day of fiscal year 2027 pursuant to the annual automatic evergreen increase provision of the 2021 Plan.
Options—The stock options activity under the 2015 Plan during the six months ended August 1, 2026 was as follows (the number of options represents shares of common stock exercisable in respect thereof):
| Number of Shares | Weighted-Average Exercise Price | Weighted-Average Remaining Contractual Term (in years) | Aggregate Intrinsic Value (1) (in thousands) | ||||||||||||||||||||
| Balance as of January 31, 2026 | $ | $ | |||||||||||||||||||||
| Granted | $ | ||||||||||||||||||||||
| Exercised | ( | $ | |||||||||||||||||||||
| Forfeited, canceled, or expired | $ | ||||||||||||||||||||||
| Balance as of August 1, 2026 | $ | $ | |||||||||||||||||||||
| Exercisable as of August 1, 2026 | $ | $ | |||||||||||||||||||||
__________
(1)Aggregate intrinsic value for stock options represents the difference between the exercise price and the per share fair value of the Company’s Class A common stock for each period end presented, multiplied by the number of stock options outstanding or exercisable as of each period end presented.
The intrinsic value of stock options exercised was $0.4 million and $1.2 million during the six months ended August 1, 2026 and August 2, 2025, respectively.
As of August 1, 2026, the Company had no remaining unrecognized stock-based compensation expense related to outstanding stock options.
RSUs—A summary of the RSUs activity under the 2015 Plan and 2021 Plan during the six months ended August 1, 2026 is presented below:
| Number of Shares | Weighted-Average Grant-Date Fair Value | ||||||||||
| Balance as of January 31, 2026 | $ | ||||||||||
| Granted | $ | ||||||||||
| Vested | ( | $ | |||||||||
| Forfeited | ( | $ | |||||||||
| Balance as of August 1, 2026 | $ | ||||||||||
As of August 1, 2026, unrecognized stock-based compensation expense related to outstanding unvested RSUs for employees that are expected to vest was approximately $659.7 million. The remaining unrecognized stock-based compensation expense is expected to be recognized over a weighted-average period of approximately 1.5 years.
2021 Employee Stock Purchase Plan—In December 2021, the Board of Directors adopted and stockholders approved the 2021 Employee Stock Purchase Plan (the “2021 ESPP”), which became effective in December 2021 in connection with the IPO. The total number of shares of the Company’s Class A common stock reserved for future issuance as of August 1, 2026 includes 5,807,155 shares added on the first day of fiscal year 2027 pursuant to the annual automatic evergreen increase provision of the 2021 ESPP.
18
The price at which Class A common stock is purchased under the 2021 ESPP is equal to 85 % of the lower of the fair market value of a share of the Company’s Class A common stock on the enrollment date or on the exercise date. The enrollment date means the first trading day of each offering period, and the exercise date means the last trading day of each purchase period. Offering periods are generally 12 months long, commencing on the first trading day on or after June 11 and December 11 of each year and terminating on the last trading day on or before June 10 and December 10 of each year. Purchase periods are generally six months long, commencing on the first trading day after one exercise date and ending with the next exercise date.
For the six months ended August 1, 2026 and August 2, 2025, 616,907 and 582,745 shares of Class A common stock were purchased under the 2021 ESPP, resulting in net cash proceeds of $17.1 million and $18.7 million, respectively.
As of August 1, 2026, unrecognized stock-based compensation expense related to the 2021 ESPP was approximately $7.2 million. The remaining unrecognized stock-based compensation expense is expected to be recognized over a weighted-average period of approximately 0.7 years.
Employee Stock Purchase Plan Valuation—The Company estimates the fair value of shares to be issued under the 2021 ESPP using the Black-Scholes option-pricing model. The Black-Scholes option-pricing model requires estimates that affect fair value. The weighted-average assumptions used to estimate the fair value of shares to be issued under the 2021 ESPP were as follows:
| Six Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Expected volatility | |||||||||||
| Expected term (years) | |||||||||||
| Risk-free interest rate | |||||||||||
| Expected dividend yield | |||||||||||
Expected volatility—The expected stock price volatility is based on the Company’s historical volatility for the expected term of the stock-based award.
Expected term—The expected term is approximately 0.5 years for the first purchase period and approximately 1.0 year for the second purchase period.
Risk-free interest rate—The risk-free interest rate assumption is based on observed U.S. Treasury yield curve interest rates in effect at the time of grant for the expected term of the stock-based award.
Expected dividend yield—Because the Company has never paid and has no current intention to pay cash dividends on its common stock, the expected dividend yield is zero .
Stock-Based Compensation Expense—Stock-based compensation expense, by grant type, was as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| RSUs | $ | $ | $ | $ | |||||||||||||||||||
| Employee stock purchase plan | |||||||||||||||||||||||
| Total stock-based compensation expense | $ | $ | $ | $ | |||||||||||||||||||
19
Stock-based compensation expense included in the following line items of the Company’s condensed consolidated statements of operations and comprehensive income (loss) was as follows (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Cost of revenue | $ | $ | $ | $ | |||||||||||||||||||
| Research and development | |||||||||||||||||||||||
| Sales and marketing | |||||||||||||||||||||||
| General and administrative | |||||||||||||||||||||||
| Total stock-based compensation expense | $ | $ | $ | $ | |||||||||||||||||||
11. Income Taxes
The Company had an effective tax rate of 7.3 % and (10.6 %) for the three months ended August 1, 2026 and August 2, 2025, respectively, and 8.6 % and (8.9 %) for the six months ended August 1, 2026 and August 2, 2025, respectively. The Company’s provision for income taxes was $1.3 million and $1.6 million for the three months ended August 1, 2026 and August 2, 2025, respectively, and $5.7 million and $3.2 million for the six months ended August 1, 2026 and August 2, 2025, respectively. The Company has incurred U.S. pretax losses in prior periods with most of the tax expense resulting from profit in the foreign entities. For the three and six months ended August 1, 2026, the U.S. incurred pretax income with most of the tax expense resulting from profit in the foreign entities.
The Company computes its tax provision for interim periods by applying the estimated annual effective tax rate to year-to-date pretax income from recurring operations and adjusting for discrete tax items arising in that quarter.
As of August 1, 2026 and January 31, 2026, based on all available objective evidence, including the existence of cumulative losses, the Company determined that it was not more likely than not that the net deferred tax assets were fully realizable for U.S. federal and state tax purposes. Accordingly, the Company established a full valuation allowance against its deferred tax assets for U.S. federal and state tax purposes. The Company intends to maintain a full valuation allowance on net deferred tax assets until sufficient positive evidence exists to support reversal of the valuation allowance for U.S. federal and state tax purposes.
The unrecognized tax benefits as of August 1, 2026, if recognized, would not affect the effective income tax rate due to the valuation allowance that currently offsets the deferred tax assets.
During the six months ended August 1, 2026, there were no material changes to the total amount of unrecognized tax benefits and the Company does not expect any significant changes in the next 12 months.
The Company files income tax returns in the U.S. federal jurisdiction and various states and foreign jurisdictions. The statute of limitations is generally open for all fiscal years after fiscal year 2022, during which the Company is subject to examination by U.S. federal, state, and foreign authorities, where applicable.
20
12. Net Income (Loss) Per Share, Basic and Diluted
For purposes of calculating net income (loss) per share, the Company uses the two-class method. As Class A, Class B, and Class C common stock have identical liquidation and dividend rights, the undistributed earnings are allocated on a proportionate basis to each class of common stock. As a result, the basic and diluted net income (loss) per share are the same for all classes of Samsara’s common stock, on both an individual and combined basis, and therefore are presented together.
Basic net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period. Diluted net income (loss) per share is computed by dividing net income (loss) by the weighted-average number of shares of common stock outstanding during the period, adjusted for the effects of dilutive shares of common stock, which consist of outstanding stock options, RSUs, and ESPP obligations. The potentially dilutive shares of common stock are computed using the treasury stock method. The effects of outstanding stock options, RSUs, and ESPP obligations are excluded from the computation of diluted net income (loss) per share in periods in which the effect would be antidilutive.
The following table presents the calculation of basic and diluted net income (loss) per share (in thousands, except share and per share data):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Numerator: | |||||||||||||||||||||||
| Net income (loss) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
| Denominator: | |||||||||||||||||||||||
| Weighted-average shares used in computing net income (loss) per share, basic | |||||||||||||||||||||||
| Weighted-average effect of potentially dilutive securities: | |||||||||||||||||||||||
| Outstanding stock options | |||||||||||||||||||||||
| RSUs | |||||||||||||||||||||||
| Employee stock purchase plan obligations | |||||||||||||||||||||||
| Weighted-average shares used in computing net income (loss) per share, diluted | |||||||||||||||||||||||
| Net income (loss) per share, basic and diluted | $ | $ | ( | $ | $ | ( | |||||||||||||||||
The following potentially dilutive securities were excluded from the computation of diluted net income (loss) per share calculations for the periods presented because the impact of including them would have been antidilutive:
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Outstanding stock options | |||||||||||||||||||||||
| RSUs | |||||||||||||||||||||||
| Employee stock purchase plan obligations | |||||||||||||||||||||||
| Total antidilutive securities | |||||||||||||||||||||||
13. Segment Information
The Company has a single operating and reportable segment. The chief operating decision maker (“CODM”) is its Chief Executive Officer, who reviews financial information presented on a consolidated basis.
The CODM makes operating decisions, assesses financial performance, and allocates resources based on consolidated operating income (loss) and consolidated net income (loss) as reported on the condensed consolidated statements of operations and comprehensive income (loss). These financial metrics are used by the CODM to monitor budget versus actual results. The measure of segment assets is reported on the condensed consolidated balance sheets as total assets.
21
The table below presents selected financial information for the single operating segment (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| Revenue | $ | $ | $ | $ | |||||||||||||||||||
Cost of revenue (1) (2) | |||||||||||||||||||||||
Research and development (1) | |||||||||||||||||||||||
Sales and marketing (1) (3) | |||||||||||||||||||||||
General and administrative (1) | |||||||||||||||||||||||
| Stock-based compensation expense | |||||||||||||||||||||||
| Connected device costs | |||||||||||||||||||||||
| Cloud and cellular costs | |||||||||||||||||||||||
| Sales commissions | |||||||||||||||||||||||
| Segment operating income (loss) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
Interest income and other income, net (4) | |||||||||||||||||||||||
| Provision for income taxes | |||||||||||||||||||||||
| Segment net income (loss) | $ | $ | ( | $ | $ | ( | |||||||||||||||||
__________
(1)These segment expenses exclude stock-based compensation expense, which is presented separately.
(2)Cost of revenue also excludes connected device costs and cloud and cellular costs, which are presented separately.
(3)Sales and marketing also excludes sales commissions, which is presented separately.
(4)Includes a legal gain from arbitration award of $30.3 million for the six months ended August 1, 2026, and interest income of $12.2 million and $24.2 million for the three and six months ended August 1, 2026, respectively, and $11.5 million and $22.6 million for the three and six months ended August 2, 2025, respectively.
Refer to the condensed consolidated financial statements for other financial information regarding the Company’s operating segment, including depreciation and amortization expense.
Revenue by Geographic Area
The following table presents revenue disaggregated by geography, based on the location of the Company’s customers (in thousands):
| Three Months Ended | Six Months Ended | ||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | August 1, 2026 | August 2, 2025 | ||||||||||||||||||||
| United States | $ | $ | $ | $ | |||||||||||||||||||
Other (1) | |||||||||||||||||||||||
| Total revenue | $ | $ | $ | $ | |||||||||||||||||||
__________
(1)No individual country other than the United States exceeded 10% of total revenue for any period presented.
22
Long-Lived Assets, Net, by Geographic Area
The following table presents long-lived assets, net, disaggregated by geography, which consist of property and equipment, net, and operating lease right-of-use assets (in thousands):
| As of | |||||||||||
| August 1, 2026 | January 31, 2026 | ||||||||||
| United States | $ | $ | |||||||||
Other (1) | |||||||||||
| Total long-lived assets, net | $ | $ | |||||||||
__________
(1)No individual country other than the United States exceeded 10% of total long-lived assets, net, for any period presented.
23
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (1) our audited consolidated financial statements and related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended January 31, 2026 included in our Annual Report on Form 10-K filed with the SEC on March 16, 2026, and (2) our unaudited condensed consolidated financial statements and related notes and other financial information included under Part I, Item 1 of this Quarterly Report on Form 10-Q. Some of the information contained in the following discussion and analysis, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Item 1A. Risk Factors” and “Special Note Regarding Forward-Looking Statements” contained in this Quarterly Report on Form 10-Q and the section titled “Risk Factors” included under Part I, Item 1A. of our Annual Report on Form 10-K filed with the SEC on March 16, 2026, as supplemented by our subsequent quarterly reports on Form 10-Q, for a discussion of forward-looking statements and important factors that could impact our business and cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis or implied by past results and trends. Unless otherwise indicated, these statements, like all statements in this Quarterly Report on Form 10-Q, speak only as of their date, and we undertake no obligation to update or revise these statements in light of future developments. Our fiscal year ends on the Saturday closest to February 1, resulting in a 52-week or 53-week fiscal year. Our fiscal years 2027 and 2026 each consist of 52 weeks.
Overview
Samsara is on a mission to increase the safety, efficiency, and sustainability of the operations that power the global economy.
To realize this vision, we pioneered the Connected Operations Platform, which is an open platform that connects the people, assets, and systems of some of the world’s most complex operations, allowing them to develop actionable insights and improve their operations.
Our Connected Operations Platform consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights using our cloud dashboard, custom alerts and reports, mobile apps, and workflows. Powered by our massive and growing data asset and expansive artificial intelligence (“AI”) technology, our differentiated, purpose-built suite of Applications and Agents enables organizations to embrace and deploy a digital, cloud-connected strategy across their operations. With Samsara, customers have the ability to drive safer operations, increase business efficiency, and achieve their sustainability goals, all to improve the lives of their employees and the customers they serve.
We were founded in 2015 and have achieved significant growth since our inception. For the three months ended August 1, 2026 and August 2, 2025, our revenue was $508.4 million and $391.5 million, respectively. Our net income was $16.2 million for the three months ended August 1, 2026 and our net loss was $16.8 million for the three months ended August 2, 2025. For the six months ended August 1, 2026 and August 2, 2025, our revenue was $987.3 million and $758.4 million, respectively. Our net income was $60.8 million for the six months ended August 1, 2026 and our net loss was $38.9 million for the six months ended August 2, 2025. Our business model focuses on maximizing the lifetime value of our customer relationships, and we continue to make significant investments to expand our customers’ use of our Connected Operations Platform.
24
Key Business Metrics
The following table presents a summary of our key business metrics as of the periods presented (dollars in thousands):
| As of | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Annual recurring revenue (“ARR”) | $ | 2,124,742 | $ | 1,640,113 | |||||||
| Customers > $100,000 ARR | 3,605 | 2,771 | |||||||||
ARR
We believe that ARR is a key indicator of the trajectory of our business performance, enables measurement of the progress of our business initiatives, and serves as an indicator of future growth. We define ARR as the annualized value of subscription contracts that have commenced revenue recognition as of the measurement date. ARR highlights trends that may be less visible from our financial statements due to ratable revenue recognition. ARR does not have a standardized meaning and is not necessarily comparable to similarly titled measures presented by other companies. ARR should be viewed independently of revenue and is not intended to be combined with or replace it. ARR is not a forecast, and the active contracts at the date used in calculating ARR may or may not be renewed. For all international customer contracts denominated in currencies other than the U.S. dollar, ARR is translated from local currency to U.S. dollar based on the currency exchange rate as of the effective date of the contract.
Number of Customers Over $100,000 in ARR
We focus on customers representing over $100,000 in ARR, as this key business metric is indicative of our penetration with larger customers. The number of our customers over $100,000 in ARR has grown over time as we have focused our sales efforts on larger customers, invested in our partner ecosystem, and released more Applications to address the needs of our larger customers.
Factors Affecting Our Performance
Acquiring New Customers
We believe that we have a substantial opportunity to continue to grow our customer base. We intend to drive new customer acquisition by continuing to invest significantly in sales and marketing to engage our prospective customers, increase brand awareness, and drive adoption of our Connected Operations Platform. Our ability to attract new customers depends on a number of factors, including the effectiveness of our sales and marketing efforts, macroeconomic factors and their impact on our customers’ businesses, and the success of our efforts to expand our international presence.
Expanding Within Our Existing Customer Base
We believe that there is a significant opportunity to expand sales to existing customers following their initial adoption of our Connected Operations Platform. We expand within our customer base by selling more Applications and Agents and expanding existing Applications and Agents across geographies and divisions. Our ability to expand within our customer base will depend on a number of factors, including our customers’ satisfaction, pricing, competition, macroeconomic factors, and changes in our customers’ spending levels.
Investments in Innovation and Future Growth
Our performance is driven by continuous innovation on our Connected Operations Platform and our ability to scale our operations to grow our business. We continuously invest in adding new data types to our Connected Operations Platform and innovate with this growing data asset to introduce new Applications and Agents over time. Our performance is also impacted by our ability to scale our operations across our business to support our growth. We remain committed to investing in our sales and marketing capacity, investing in world-class talent and productivity tools, and driving revenue growth globally.
25
Macroeconomic Trends
Unfavorable conditions in the economy, both in the United States and abroad, may negatively affect the growth of our business and our results of operations. For example, our business and results of operations, as well as those of our customers, could be affected by global macroeconomic trends and events such as inflationary pressure, fluctuations in foreign currency exchange rates, interest rate increases and declines in consumer confidence, widespread disruptions of supply chains and freight and shipping channels, increased prices for many goods and services (including elevated hardware component costs, memory, storage and computing costs, and fuel costs), labor shortages, delayed or reduced spending on technology, and significant volatility and disruption of financial markets, as well as other conditions arising from international conflicts and geopolitical tension, the outcome of political elections, and new monetary, fiscal, and trade policies (including tariff policies and import and export restrictions) in the United States and abroad. We are continuously monitoring these global events and other macroeconomic developments and how they may impact us directly or indirectly as a result of the effects on our customers and suppliers.
Refer to the section titled “Risk Factors” in Part II, Item 1A and elsewhere in this Quarterly Report on Form 10-Q and the section titled “Risk Factors” in Part I, Item 1A and elsewhere in our Annual Report on Form 10-K filed on March 16, 2026, as supplemented by our subsequent quarterly reports on Form 10-Q, for further discussion of the impacts of macroeconomic trends on our business.
Components of Results of Operations
Revenue
We provide access to our Connected Operations Platform primarily through subscription arrangements, whereby the customer is charged a per-subscription fee for access for a specified term. Subscription agreements contain multiple service elements for one or more of our cloud-based Applications via mobile app(s) or a website that enable data collection and provide access to the cellular network, generally one or more wireless gateways, cameras, sensors and other devices (which we also refer to as connected devices or IoT devices), that are delivered over the term of the arrangement, and warranty coverage. Our subscription contracts typically have an initial term of three to five years and are generally non-cancelable and non-refundable, subject to limited exceptions under our standard terms of service and other exceptions for public sector customers, who are often subject to annual budget appropriations cycles. Our Connected Operations Platform and IoT devices are highly interdependent and interrelated, and represent a combined performance obligation within the context of the contract.
In each of our past two fiscal years, we generated approximately 98% of our revenue from subscriptions to our Connected Operations Platform. The remaining portion of our revenue not generated from subscriptions to our Connected Operations Platform is derived from the sale of replacement IoT devices, shipping and handling fees, and professional services.
Cost of Revenue
Cost of revenue consists primarily of the amortization of connected device costs associated with subscription agreements, third-party cloud and cellular costs, employee-related costs directly associated with our customer support and supply chain teams, including salaries, benefits, and stock-based compensation, amortization of internal-use software costs, fulfillment costs, warranty costs, provision for excess and obsolete inventory, and costs associated with software subscriptions and office facilities.
As our customers expand and increase the use of our Connected Operations Platform driven by additional IoT devices and Applications, our cost of revenue may vary from quarter to quarter as a percentage of our revenue due to the timing and extent of these expenses. Our cost of revenue may also increase as a result of higher market prices for hardware components. We intend to continue to invest additional resources in our Connected Operations Platform, including in our IoT device hardware, cloud infrastructure, and cellular connectivity, as well as in customer support and operations as we grow our business. The level and timing of investment in these areas will affect our cost of revenue in the future.
Operating Expenses
Research and Development
Research and development expenses consist primarily of employee-related costs, including salaries, benefits, and stock-based compensation, associated with improvements to our platform and current offerings and the development of new products, and costs associated with software subscriptions, and office facilities. We continue to focus our research and development efforts on adding new features and products and enhancing the utility of our Connected Operations Platform.
26
We expect our research and development expenses to generally increase in absolute dollars for the foreseeable future as we continue to invest in research and development efforts to enhance our Connected Operations Platform. Our research and development expenses have fluctuated in the past and may in the future fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
Sales and Marketing
Sales and marketing expenses consist primarily of employee-related costs, including salaries, benefits, stock-based compensation, and sales commissions incurred to acquire and retain new customers and increase product adoption with our existing customers. Sales and marketing expenses also include marketing activities, promotional events, and costs associated with software subscriptions and office facilities.
We plan to continue to invest in sales and marketing to expand our customers’ use of our Connected Operations Platform and increase our brand awareness. As a result, we expect our sales and marketing expenses to generally increase in absolute dollars for the foreseeable future. Our sales and marketing expenses have fluctuated in the past and may in the future fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses, including seasonally higher spend on promotional events in the first half of our fiscal year.
General and Administrative
General and administrative expenses consist primarily of employee-related costs for executive, finance, legal, and human resources, including salaries, benefits, and stock-based compensation. General and administrative expenses also include costs related to professional services, including legal, accounting, recruiting and other consulting services, as well as costs associated with software subscriptions and office facilities.
We expect our general and administrative expenses to continue to increase in absolute dollars for the foreseeable future to support our growth. Our general and administrative expenses have fluctuated in the past and may in the future fluctuate as a percentage of our revenue from period to period due to the timing and extent of these expenses.
Interest Income and Other Income, Net
Interest income and other income, net, consists primarily of income earned on our money market funds and marketable debt securities, including amortization of premiums and accretion of discounts, and net unrealized gains (losses) on our strategic investments. It also includes one-time gains and losses not associated with our core operations and the effect of changes in foreign currency exchange rates. As we have expanded our global operations, our exposure to fluctuations in foreign currencies has increased, and we expect this to continue.
Provision for Income Taxes
Provision for income taxes consists primarily of income taxes in certain foreign jurisdictions in which we conduct business. We maintain a full valuation allowance against our U.S. deferred tax assets because we have concluded that it is not more likely than not that the deferred tax assets will be realized.
Results of Operations
Comparison of the Three and Six Months Ended August 1, 2026 and August 2, 2025
Revenue
Our total revenue is summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| Revenue | $ | 508,437 | $ | 391,480 | $ | 116,957 | 30 | % | $ | 987,281 | $ | 758,364 | $ | 228,917 | 30 | % | |||||||||||||||||||||||||||||||
Revenue increased by $117.0 million and $228.9 million, or 30%, for the three and six months ended August 1, 2026, respectively, compared to the three and six months ended August 2, 2025, primarily due to growth in new customers and increased purchases by existing customers.
27
Cost of Revenue, Gross Profit, and Gross Margin
Our cost of revenue, gross profit, and gross margin are summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| Cost of revenue | $ | 115,856 | $ | 90,501 | $ | 25,355 | 28 | % | $ | 233,557 | $ | 173,670 | $ | 59,887 | 34 | % | |||||||||||||||||||||||||||||||
| Gross profit | $ | 392,581 | $ | 300,979 | $ | 753,724 | $ | 584,694 | |||||||||||||||||||||||||||||||||||||||
| Gross margin | 77 | % | 77 | % | 76 | % | 77 | % | |||||||||||||||||||||||||||||||||||||||
Cost of revenue increased by $25.4 million, or 28%, for the three months ended August 1, 2026 compared to the three months ended August 2, 2025, primarily due to $11.7 million of increased cloud and cellular costs, $6.4 million of increased connected device costs, and $3.3 million of increased employee-related costs. The increases in cloud and cellular costs and connected device costs were primarily due to increased sales volume and additional product features and functionality year-over-year. The increase in employee-related costs was primarily due to increased headcount.
Our gross margin remained flat at 77% for the three months ended August 1, 2026 compared to the three months ended August 2, 2025.
Cost of revenue increased by $59.9 million, or 34%, for the six months ended August 1, 2026 compared to the six months ended August 2, 2025, primarily due to $27.8 million of increased cloud and cellular costs, $17.1 million of increased connected device costs, and $6.3 million of increased employee-related costs. The increases in cloud and cellular costs and connected device costs were primarily due to increased sales volume and additional product features and functionality year-over-year. The increase in employee-related costs was primarily due to increased headcount.
Our gross margin decreased to 76% for the six months ended August 1, 2026 compared to 77% for the six months ended August 2, 2025, primarily due to increased cloud and cellular costs.
Research and Development
Research and development expense is summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| Research and development | $ | 102,556 | $ | 85,612 | $ | 16,944 | 20 | % | $ | 200,123 | $ | 168,854 | $ | 31,269 | 19 | % | |||||||||||||||||||||||||||||||
| Percentage of revenue | 20 | % | 22 | % | 20 | % | 22 | % | |||||||||||||||||||||||||||||||||||||||
Research and development expense increased by $16.9 million, or 20%, for the three months ended August 1, 2026 compared to the three months ended August 2, 2025, primarily due to a $6.8 million increase in costs associated with software subscriptions, a $6.4 million increase in stock-based compensation expense, and a $6.2 million increase in platform costs driven by investments in AI tooling and related development infrastructure.
Research and development expense increased by $31.3 million, or 19%, for the six months ended August 1, 2026 compared to the six months ended August 2, 2025, primarily due to a $12.8 million increase in costs associated with software subscriptions, a $10.8 million increase in platform costs driven by investments in AI tooling and related development infrastructure, and a $10.1 million increase in employee-related costs primarily due to higher stock-based compensation expense.
28
Sales and Marketing
Sales and marketing expense is summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| Sales and marketing | $ | 217,774 | $ | 174,083 | $ | 43,691 | 25 | % | $ | 421,377 | $ | 339,483 | $ | 81,894 | 24 | % | |||||||||||||||||||||||||||||||
| Percentage of revenue | 43 | % | 45 | % | 43 | % | 45 | % | |||||||||||||||||||||||||||||||||||||||
Sales and marketing expense increased by $43.7 million, or 25%, for the three months ended August 1, 2026 compared to the three months ended August 2, 2025, primarily due to a $25.7 million increase in employee-related costs which included a $6.1 million increase in sales commissions and a $4.5 million increase in stock-based compensation expense primarily due to increased headcount. The increase in sales and marketing expense was also due to an $11.5 million increase in expenditures incurred to generate demand through various marketing channels and promotional events, including our annual customer and investor conference.
Sales and marketing expense increased by $81.9 million, or 24%, for the six months ended August 1, 2026 compared to the six months ended August 2, 2025, primarily due to a $49.2 million increase in employee-related costs which included an $11.8 million increase in sales commissions and a $4.1 million increase in stock-based compensation expense primarily due to increased headcount. The increase in sales and marketing expense was also due to a $21.2 million increase in expenditures incurred to generate demand through various marketing channels and promotional events.
General and Administrative
General and administrative expense is summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| General and administrative | $ | 67,376 | $ | 67,903 | $ | (527) | (1 | %) | $ | 120,154 | $ | 136,231 | $ | (16,077) | (12 | %) | |||||||||||||||||||||||||||||||
| Percentage of revenue | 13 | % | 17 | % | 12 | % | 18 | % | |||||||||||||||||||||||||||||||||||||||
General and administrative expense for the three months ended August 1, 2026 compared to the three months ended August 2, 2025 remained relatively flat.
General and administrative expense decreased by $16.1 million, or 12%, for the six months ended August 1, 2026 compared to the six months ended August 2, 2025, primarily due to a $17.8 million decrease in professional services fees, driven primarily by lower legal fees.
Interest Income and Other Income, Net
Interest income and other income, net, are summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| Interest income and other income, net | $ | 12,654 | $ | 11,426 | $ | 1,228 | 11 | % | $ | 54,386 | $ | 24,149 | $ | 30,237 | 125 | % | |||||||||||||||||||||||||||||||
Interest income and other income, net, increased by $1.2 million, or 11%, for the three months ended August 1, 2026 compared to the three months ended August 2, 2025. This increase was primarily due to unrealized gains from strategic investments, partially offset by foreign currency losses.
Interest income and other income, net, increased by $30.2 million, or 125%, for the six months ended August 1, 2026 compared to the six months ended August 2, 2025. This increase was primarily due to a $30.3 million arbitration award issued in Samsara’s favor in the Motive breach of contract, fraud, unfair competition, and false advertising matter.
29
Provision for Income Taxes
Provision for income taxes is summarized as follows (in thousands, except percentages):
| Three Months Ended | Change | Six Months Ended | Change | ||||||||||||||||||||||||||||||||||||||||||||
| August 1, 2026 | August 2, 2025 | Amount | % | August 1, 2026 | August 2, 2025 | Amount | % | ||||||||||||||||||||||||||||||||||||||||
| Provision for income taxes | $ | 1,287 | $ | 1,607 | $ | (320) | (20 | %) | $ | 5,706 | $ | 3,196 | $ | 2,510 | 79 | % | |||||||||||||||||||||||||||||||
| Effective tax rate | 7.3 | % | (10.6 | %) | 8.6 | % | (8.9 | %) | |||||||||||||||||||||||||||||||||||||||
The provision for income taxes for the three months ended August 1, 2026 compared to the three months ended August 2, 2025 remained relatively flat.
The provision for income taxes increased by $2.5 million, or 79%, for the six months ended August 1, 2026 compared to the six months ended August 2, 2025, due to growth in our operations in foreign jurisdictions.
Non-GAAP Financial Measures
To supplement our condensed consolidated financial statements prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”), we review the following non-GAAP financial measures to evaluate our business, measure our performance, identify trends affecting our business, formulate business plans, and make strategic decisions (in thousands, except percentages):
| Three Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Non-GAAP gross profit | $ | 397,998 | $ | 305,692 | |||||||
| Non-GAAP gross margin | 78 | % | 78 | % | |||||||
| Non-GAAP operating income | $ | 105,981 | $ | 59,698 | |||||||
| Non-GAAP operating margin | 21 | % | 15 | % | |||||||
| Non-GAAP net income | $ | 117,348 | $ | 69,517 | |||||||
| Six Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Free cash flow | $ | 137,918 | $ | 89,884 | |||||||
| Free cash flow margin | 14 | % | 12 | % | |||||||
Limitations and Reconciliations of Non-GAAP Financial Measures
Non-GAAP financial measures have limitations as analytical tools and should not be considered in isolation or as substitutes for financial information presented under GAAP. There are a number of limitations related to the use of non-GAAP financial measures versus comparable financial measures determined under GAAP. For example, other companies in our industry may calculate these non-GAAP financial measures differently or may use other measures to evaluate their performance. In addition, free cash flow does not reflect our future contractual commitments or the total increase or decrease of our cash balance for a given period. These and other limitations could reduce the usefulness of these non-GAAP financial measures as analytical tools. Investors are encouraged to review the related GAAP financial measures and the reconciliations of these non-GAAP financial measures to their most directly comparable GAAP financial measures and to not rely on any single financial measure to evaluate our business.
Expenses Excluded from Non-GAAP Performance Financial Measures
Stock-based compensation expense-related charges include the amortization of deferred stock-based compensation expense for internal-use software and cloud computing arrangements and employer taxes on employee equity transactions. Stock-based compensation expense is a non-cash expense and is dependent on our stock price, which is beyond our control. Accordingly, we find it useful to exclude stock-based compensation expense in order to better understand our ongoing operational performance. Employer taxes on employee equity transactions, which are cash expenses, are excluded because such taxes are directly tied to the timing and size of employee equity transactions and the future fair market value of our common stock, which may vary from period to period independent of the operating performance of our business.
In periods when they occur, significant lease modification, impairment and related charges, and legal settlements and awards are excluded because management believes that such charges are not reflective of our ongoing operational performance.
30
Non-GAAP Performance Financial Measures
Non-GAAP Gross Profit and Non-GAAP Gross Margin
We define non-GAAP gross profit as gross profit excluding the effect of stock-based compensation expense-related charges included in cost of revenue. Non-GAAP gross margin is defined as non-GAAP gross profit as a percentage of total revenue. We use non-GAAP gross profit and non-GAAP gross margin in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP gross profit and non-GAAP gross margin provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP gross profit to our GAAP gross profit for the periods presented (in thousands, except percentages):
| Three Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Gross profit | $ | 392,581 | $ | 300,979 | |||||||
| Add: | |||||||||||
Stock-based compensation expense-related charges (1) | 5,417 | 4,713 | |||||||||
| Non-GAAP gross profit | $ | 397,998 | $ | 305,692 | |||||||
| GAAP gross margin | 77 | % | 77 | % | |||||||
| Non-GAAP gross margin | 78 | % | 78 | % | |||||||
__________
(1)Stock-based compensation expense-related charges included approximately $0.2 million and $0.3 million of employer taxes on employee equity transactions for the three months ended August 1, 2026 and August 2, 2025, respectively.
Non-GAAP Operating Income and Non-GAAP Operating Margin
We define non-GAAP operating income as income (loss) from operations excluding the effect of stock-based compensation expense-related charges, lease modification, impairment and related charges, and legal settlements and awards, in periods when they occur. Non-GAAP operating margin is defined as non-GAAP operating income as a percentage of total revenue. We use non-GAAP operating income and non-GAAP operating margin in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP operating income and non-GAAP operating margin provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP operating income to our GAAP income (loss) from operations for the periods presented (in thousands, except percentages):
| Three Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Income (loss) from operations | $ | 4,875 | $ | (26,619) | |||||||
| Add: | |||||||||||
Stock-based compensation expense-related charges (1) | 101,106 | 86,317 | |||||||||
| Non-GAAP operating income | $ | 105,981 | $ | 59,698 | |||||||
| GAAP operating margin | 1 | % | (7 | %) | |||||||
| Non-GAAP operating margin | 21 | % | 15 | % | |||||||
__________
(1)Stock-based compensation expense-related charges included amortization of capitalized stock-based compensation expense of approximately $1.5 million and $0.8 million for the three months ended August 1, 2026 and August 2, 2025, respectively, which was initially capitalized as internal-use software or cloud computing arrangements. Stock-based compensation expense-related charges also included approximately $3.3 million and $4.4 million of employer taxes on employee equity transactions for the three months ended August 1, 2026 and August 2, 2025, respectively.
31
Non-GAAP Net Income
We define non-GAAP net income as net income (loss) excluding the effect of stock-based compensation expense-related charges, lease modification, impairment and related charges, and legal settlements and awards, in periods when they occur. We use non-GAAP net income in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP net income provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP net income to our GAAP net income (loss) for the periods presented (in thousands, except percentages):
| Three Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Net income (loss) | $ | 16,242 | $ | (16,800) | |||||||
| Add: | |||||||||||
| Stock-based compensation expense-related charges | 101,106 | 86,317 | |||||||||
Non-GAAP net income (1) | $ | 117,348 | $ | 69,517 | |||||||
__________
(1)There were no material income tax effects on our non-GAAP adjustments for all periods presented.
Non-GAAP Liquidity Financial Measures
Free Cash Flow and Free Cash Flow Margin
We define free cash flow as net cash provided by operating activities reduced by cash used for purchases of property and equipment. Free cash flow margin is calculated as free cash flow as a percentage of total revenue. We believe that free cash flow and free cash flow margin are useful in evaluating liquidity and provide information to management and investors about our ability to fund future operating needs and strategic initiatives. The following table presents a reconciliation of free cash flow to net cash provided by operating activities for the periods presented (in thousands, except percentages):
| Six Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Net cash provided by operating activities | $ | 154,937 | $ | 102,773 | |||||||
| Purchases of property and equipment | (17,019) | (12,889) | |||||||||
| Free cash flow | $ | 137,918 | $ | 89,884 | |||||||
| Net cash provided by operating activities margin | 16 | % | 14 | % | |||||||
| Free cash flow margin | 14 | % | 12 | % | |||||||
| Net cash used in investing activities | $ | (129,518) | $ | (86,445) | |||||||
| Net cash provided by (used in) financing activities | $ | (53,415) | $ | 18,043 | |||||||
Liquidity and Capital Resources
Liquidity is a measure of our ability to access sufficient cash flows to meet the short-term and long-term cash requirements of our business operations.
Since our founding, we have financed our operations primarily through the sale of equity securities and payments received from our customers. In December 2021, we completed our initial public offering (“IPO”), which resulted in aggregate net proceeds of $846.7 million, including proceeds from the underwriters’ exercise of their option to purchase additional shares of our Class A common stock in January 2022 and net of underwriting discounts and commissions. We have generated significant operating losses from our operations, as reflected in our accumulated deficit of $1,558.4 million as of August 1, 2026. We intend to continue investing in our business, and as a result, we may require additional capital resources to execute on our strategic initiatives to grow our business, particularly if we generate negative cash flows in future quarters. We believe that our existing cash, cash equivalents, and short-term and long-term investments will be sufficient to support working capital, including our non-cancelable arrangements, and capital expenditure requirements for at least the next 12 months.
32
As of August 1, 2026, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments of $1,325.7 million. Cash and cash equivalents consisted of cash as well as highly liquid investments with an original maturity of 90 days or less, when purchased. Our investments primarily consisted of U.S. government, agency, and municipal securities, corporate notes and bonds, and commercial paper. Our primary uses of cash include employee-related expenditures, third-party cloud and cellular costs, sales and marketing expenses, overhead expenses, and funding other working capital requirements, such as inventory and related connected device costs to meet our performance obligations related to our Connected Operations Platform.
Our future capital requirements will depend on many factors, including, but not limited to, our growth, our ability to attract and retain customers, the continued market acceptance of our solution, the timing and extent of spending necessary to support our efforts to develop our Connected Operations Platform and meet our performance obligations related to customers, the expansion of sales and marketing activities, and the impact of macroeconomic conditions on our and our customers’ and partners’ businesses. Further, we may in the future enter into arrangements to acquire or invest in businesses, products, services, and technologies. We may be required to seek additional equity or debt financing. In the event that additional financing is required, we may not be able to raise it on terms acceptable to us or at all. If we are unable to raise additional capital when desired, our business, financial condition, and results of operations could be adversely affected.
Cash Flows
The following table presents a summary of our cash flows for the periods presented (in thousands):
| Six Months Ended | |||||||||||
| August 1, 2026 | August 2, 2025 | ||||||||||
| Net cash provided by operating activities | $ | 154,937 | $ | 102,773 | |||||||
| Net cash used in investing activities | $ | (129,518) | $ | (86,445) | |||||||
| Net cash provided by (used in) financing activities | $ | (53,415) | $ | 18,043 | |||||||
Operating Activities
Our largest source of operating cash is payments received from our customers. Our primary uses of cash from operating activities are for employee-related expenditures, third-party cloud and cellular costs, sales and marketing expenses, general and administrative costs, and purchases of inventory and connected device costs. We have supplemented working capital through net proceeds from the sale of equity securities.
Cash provided by operating activities mainly consists of our net income (loss) adjusted for certain non-cash items, including stock-based compensation, depreciation and amortization of property and equipment, and net accretion of discounts on marketable debt securities, and changes in operating assets and liabilities during each period.
Cash provided by operating activities was $154.9 million for the six months ended August 1, 2026. This consisted of net income of $60.8 million, adjusted for non-cash charges of $188.3 million, partially offset by $94.1 million of cash used by changes in our operating assets and liabilities. The non-cash charges were primarily composed of stock-based compensation expense of $173.9 million and depreciation and amortization of $16.3 million. Changes in our operating assets and liabilities during the six months ended August 1, 2026 reflect higher connected device costs (offset by a one-time $12.4 million cash refund related to tariffs), deferred commissions, and accounts receivable from customers due to the growth of our business; the recognition of an arbitration award receivable; and increases in inventory levels to meet anticipated demand. These increases were partially offset by increases in deferred revenue due to the growth of our business and lower vendor payments.
Cash provided by operating activities was $102.8 million for the six months ended August 2, 2025. This consisted of a net loss of $38.9 million, adjusted for non-cash charges of $162.7 million, partially offset by $21.0 million of cash used by changes in our operating assets and liabilities. The non-cash charges were primarily composed of stock-based compensation expense of $158.2 million and depreciation and amortization of $10.5 million, partially offset by net accretion of discounts on marketable debt securities of $5.0 million. Changes in our operating assets and liabilities during the six months ended August 2, 2025 reflect an increase in deferred commissions, connected device costs, and accounts receivable from customers due to the growth of our business; increases in vendor payments; and inventory levels to meet anticipated demand. These increases were partially offset by increases in deferred revenue due to the growth of our business.
Investing Activities
Cash used in investing activities was $129.5 million for the six months ended August 1, 2026, which primarily consisted of $578.5 million of purchases of investments and $12.2 million of capitalized internal-use software costs, partially offset by $465.9 million of proceeds from maturities and redemptions of investments.
33
Cash used in investing activities was $86.4 million for the six months ended August 2, 2025, which primarily consisted of $421.9 million of purchases of investments and $10.3 million of capitalized internal-use software costs, partially offset by $348.6 million of proceeds from maturities and redemptions of investments.
Financing Activities
Cash used in financing activities was $53.4 million for the six months ended August 1, 2026, which primarily consisted of $70.4 million of tax payments to net share settle equity awards, partially offset by $17.1 million of proceeds from employee stock purchases under the 2021 Employee Stock Purchase Plan (the “2021 ESPP”) and exercises of stock options.
Cash provided by financing activities was $18.0 million for the six months ended August 2, 2025, which primarily consisted of $18.7 million of proceeds from employee stock purchases under the 2021 ESPP and exercises of stock options.
Contractual Obligations and Commitments
Our estimated future obligations consist of leases and non-cancelable purchase commitments as of August 1, 2026. For additional discussion on our leases and other commitments, refer to Notes 8, “Leases,” and 9, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Critical Accounting Estimates
Our condensed consolidated financial statements and the related notes thereto included elsewhere in this Quarterly Report on Form 10-Q are prepared in accordance with GAAP.
The preparation of our condensed consolidated financial statements in conformity with GAAP requires us to make estimates and judgments that affect the amounts reported in those financial statements and accompanying notes. Although we believe that the estimates we use are reasonable, due to the inherent uncertainty involved in making those estimates, actual results reported in future periods could differ from those estimates.
There were no material changes to our critical accounting estimates during the six months ended August 1, 2026.
Recent Accounting Pronouncements
For information on recently issued accounting pronouncements, refer to Note 2, “Summary of Significant Accounting Policies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
We are exposed to market risks in connection with our business, which primarily relate to fluctuations in interest rates and foreign exchange and inflation risks.
Interest Rate Risk
As of August 1, 2026, we had $1,325.7 million of cash, cash equivalents, and short-term and long-term investments in a variety of marketable debt securities, including U.S. government, agency, and municipal securities, corporate notes and bonds, and commercial paper. Our cash, cash equivalents, and short-term and long-term investments are held for working capital purposes. We do not enter into investments for trading or speculative purposes. Our cash equivalents and our portfolio of marketable debt securities are subject to market risk due to changes in interest rates. A hypothetical 100 basis point increase or decrease in interest rates would have resulted in a decrease of $8.9 million or an increase of $8.9 million in the market value of our cash equivalents and short-term and long-term investments as of August 1, 2026.
As of January 31, 2026, we had $1,236.9 million of cash, cash equivalents, and short-term and long-term investments, and a hypothetical 100 basis point increase or decrease in interest rates would have resulted in a decrease of $7.3 million or an increase of $7.2 million in the market value.
34
Foreign Currency Exchange Risk
Our reporting currency is the U.S. dollar. The functional currency of our wholly-owned foreign subsidiaries is the U.S. dollar or the Mexican peso. A substantial majority, but not all, of our sales are denominated in U.S. dollars. Our operating expenses are denominated in the currencies of the countries in which our operations are located, which are primarily in the United States, the United Kingdom, and Mexico. Our condensed consolidated results of operations and cash flows are, therefore, subject to fluctuations due to changes in foreign currency exchange rates and may be adversely affected in the future due to changes in foreign currency exchange rates. To date, we have not entered into any hedging arrangements with respect to foreign currency risk or other derivative financial instruments, although we may choose to do so in the future. We do not believe that a hypothetical 10% increase or decrease in the relative value of the U.S. dollar to other currencies during any of the periods presented would have had a material impact on our condensed consolidated financial statements. For all international customer contracts denominated in currencies other than the U.S. dollar, certain of our operating metrics, including ARR, are translated from local currency to U.S. dollar based on the currency exchange rate as of the effective date of the contract.
Inflation Risk
We do not believe that inflation has had a material impact on our condensed consolidated financial statements. If our costs were to become subject to significant inflationary pressures, we may not be able to fully offset such higher costs through price increases. Our inability or failure to do so could have a material impact on our condensed consolidated financial statements.
Item 4. Controls and Procedures
Evaluation of Disclosure Controls and Procedures
Our management, with the participation and supervision of our principal executive officer and principal financial officer, has evaluated the effectiveness of the design and operation of our disclosure controls and procedures, as defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act, as of the end of the period covered by this Quarterly Report on Form 10-Q.
Based on that evaluation, our principal executive officer and principal financial officer have concluded that as of the end of the period covered by this Quarterly Report on Form 10-Q, our disclosure controls and procedures are designed to, and are effective to, provide reasonable assurance that the information we are required to disclose in reports that we file or submit under the Exchange Act is recorded, processed, summarized, and reported within the time periods specified in SEC rules and forms, and that such information is accumulated and communicated to our management, including our principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosures.
Changes in Internal Control Over Financial Reporting
Under the supervision and with the participation of our management, including our principal executive officer and principal financial officer, we conducted an evaluation of any changes in our internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) that occurred during our most recently completed fiscal quarter. Based on that evaluation, our principal executive officer and principal financial officer concluded that there has not been any material change in our internal control over financial reporting during the fiscal quarter ended August 1, 2026 that materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.
Inherent Limitations on Effectiveness of Disclosure Controls and Procedures and Internal Control Over Financial Reporting
Our management, including our principal executive officer and principal financial officer, does not expect that our disclosure controls and procedures or our internal control over financial reporting will prevent or detect all errors and fraud. A control system, no matter how well designed and operated, can provide only reasonable, not absolute, assurance that the objectives of the control system are met. Further, the design of a control system must reflect the fact that there are resource constraints and the benefits of controls must be considered relative to their costs. Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur because of an error or mistake. Additionally, controls can be circumvented by the individual acts of some persons, by collusion of two or more people, or by management override. The design of any system of controls is also based in part upon certain assumptions about the likelihood of future events, and there can be no assurance that any design will succeed in achieving its stated goals under all potential future conditions; over time, controls may become inadequate because of changes in conditions or the degree of compliance with policies or procedures may deteriorate. Due to inherent limitations in a control system, misstatements due to error or fraud may occur and may not be detected.
35
PART II—OTHER INFORMATION
Item 1. Legal Proceedings
We are involved in various legal proceedings arising from the normal course of business activities. We are not presently a party to any litigation the outcome of which, we believe, if determined adversely to us, would individually or taken together have a material adverse effect on our business, operating results, cash flows, or financial condition. The results of any current or future litigation cannot be predicted with certainty, and regardless of the outcome, litigation can have an adverse impact on us because of defense and settlement costs, diversion of management resources, and other factors. For additional information on legal proceedings, refer to the section titled “Litigation” under Note 9, “Commitments and Contingencies,” to our condensed consolidated financial statements included elsewhere in this Quarterly Report on Form 10-Q.
Item 1A. Risk Factors
Our business, operations, and financial condition are subject to various risks and uncertainties that could materially adversely affect our business, results of operations, financial condition, growth prospects, and the trading price of our Class A common stock. The following factors, among others not currently known by us or that we currently do not believe are material, could cause our actual results to differ materially from historical results and those expressed in forward-looking statements made by us or on our behalf in filings with the SEC, press releases, communications with investors, and oral and other statements. You should carefully consider the following updated risks and uncertainties, together with all the other information contained in this Quarterly Report on Form 10-Q, as well as the risk factors discussed in “Part I, Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended January 31, 2026, and “Part II, Item 1A. Risk Factors” in our Quarterly Report on Form 10-Q for the fiscal quarter ended May 2, 2026, which remain applicable to our business.
Our dependence on a limited number of joint design manufacturers and suppliers of manufacturing services and critical components within our supply chain for our IoT devices may adversely affect our ability to sell subscriptions to our Connected Operations Platform, our margins, and our results of operations.
Our IoT devices are made using a primarily outsourced manufacturing business model that utilizes joint design manufacturers. We depend on a limited number of joint design manufacturers and suppliers, and in some instances, a single joint design manufacturer or supplier, to allocate sufficient capacity to meet our needs, to produce IoT devices, or components and materials thereof, of acceptable quality at acceptable yields, and to deliver those devices or components to us on a timely basis. We are subject to the risk of shortages and long lead times in the supply of these devices, components, and materials. In addition, the lead times associated with certain components are lengthy and preclude rapid changes in quantities and delivery schedules. We have in the past experienced and may in the future experience component shortages, and the availability of these components may be unpredictable. For example, previous global silicon component shortages have resulted in increased costs and delayed shipments across many industries, including for components used in our IoT devices. Additionally, demand for memory and storage components driven by investment in artificial intelligence infrastructure has caused leading memory suppliers to reallocate manufacturing capacity away from the categories of dynamic random-access memory and NAND flash memory used in devices such as ours. This has resulted, and may continue to further result, in increases in the prices of these components, extended lead times, allocation-based ordering, and end-of-life notices for certain component types. Because we design our IoT devices around specific components, we may be unable to substitute alternative components without undertaking hardware or firmware redesign, requalification, or recertification, any of which could be costly and delay shipments. Global transportation and freight networks have been strained as a result of global health crises, geopolitical conflicts, labor disputes, and other factors, which cause freight shipping costs and lead times to increase. Increases in the cost of devices or components, or freight to transport those items, could negatively impact our results of operations.
Our manufacturers and suppliers will continue to face the risk of temporary or permanent disruptions in their manufacturing operations due to component or material shortages, cost increases (such as increases in the cost of memory, storage, resins and computing), equipment breakdowns, labor strikes or shortages, natural disasters, disease outbreaks and resulting lockdowns, energy crises and power outages, geopolitical tension, civil unrest, hostilities or wars, trade policies, tariffs, acquisitions, insolvency, changes in legal or regulatory requirements, or other similar problems. Our manufacturers, suppliers, and sub-tier suppliers have a large presence in China and Taiwan. Any increase in tensions between China and Taiwan, including threats of military actions or escalation of military activities, could adversely affect our suppliers’ and joint design manufacturers’ operations in Taiwan and secondary locations in Asia. Although we have extended our supply orders to the latest quoted lead times, qualified additional components, and have in the past made preemptive spot purchases to build out our inventory, we cannot guarantee that we will have sufficient inventory for our needs or that future disruptions to our supply of IoT devices or materials will not occur. Any delay in the shipment of IoT devices or any other necessary materials delays our ability to recognize revenue for subscriptions purchased by our customers.
36
In addition, some of our suppliers, joint design manufacturers, and logistics providers may have more established relationships with larger-volume device manufacturers, and as a result of such relationships, such suppliers may choose to limit or terminate their relationship with us. Developing suitable alternate sources of supply for these devices and components may be time-consuming, difficult, and costly, and we may not be able to source these devices and components on terms that are favorable to us, or at all, which may adversely affect our ability to meet our requirements or provide our customers with needed IoT devices in a timely or cost-effective manner. Because our customers often must install IoT devices before being able to fully utilize our Connected Operations Platform, any interruption or delay in the supply of any of these devices or components, or the inability to obtain these devices or components from alternate sources at acceptable prices and within a reasonable amount of time, would harm our ability to onboard new customers.
Evolving trade policies, including the imposition of tariffs and other trade barriers by the United States and other countries, and increased trade enforcement globally, can have the effect of increasing production costs and creating disruptions and delays in supply chains. We expect that the occurrence of these developments in regions where we operate, such as North America and Europe, would likely increase the cost of our devices, disrupt supply chain logistics, and affect our ability to efficiently transport, store, and deliver our IoT devices to customers, which could negatively impact our revenue growth and operating margins. Our efforts to optimize our supply chain and manufacturing practices in light of evolving trade policies, component, production, and transportation costs, and other factors can be expensive, time-consuming, ineffective, and disruptive to our business and results of operations and may not succeed.
Abuse or misuse of our internal platform controls and system tools, or unintended or unauthorized actions by AI agents using such tools, could cause significant harm to our business and reputation.
In order to provide real-time support to our customers and improve and develop our products, we have created internal platform and system tools that are used by our employees to access data and systems. We may also use AI, including autonomous or agentic AI systems, in connection with our internal operations, software development, security, customer support, or other activities, and such systems may be permitted to access data, execute code, use internal tools, interact with other systems, or take actions on our behalf. If our employees were to intentionally or negligently abuse or misuse these tools, for example, by interfering with or altering our IoT devices or our customers’ connected assets, accessing our customers’ data, or otherwise violating company policies, our customers could be significantly harmed. Similarly, AI agents could take unintended or unauthorized actions, act outside the scope of their instructions or permissions, or exploit vulnerabilities or weaknesses in the systems or environments in which they operate. For example, AI agents with access to software development, computing, network, or other system resources may be capable of circumventing or escaping technical restrictions or isolated execution environments, including containers or other sandboxing mechanisms; obtaining access to networks or systems that were not intended to be accessible; escalating privileges; accessing, modifying, or disclosing confidential information; or using available tools and credentials to take additional unauthorized actions. Such actions may occur autonomously, at significant scale or speed, and in ways that are difficult for us to predict, detect, prevent, or terminate. Our technical safeguards, access controls, monitoring, isolation mechanisms, and other measures designed to constrain the actions of AI systems may not operate as intended or may be insufficient to prevent such behavior.
Our employees have historically had broad access to customers’ video footage and other customer data, and although we have implemented access controls, such controls may not ensure that access to and use of customer data by our employees or AI-enabled systems is in all cases appropriate. Additionally, some of our Applications have features allowing them to control large industrial assets or interact with some operations of vehicles. Any abuse or misuse of these capabilities, or unintended or unauthorized actions by an AI agent with access to systems capable of exercising such functionality, could cause substantial disruption or damage to our customers, including potentially affecting their physical operations or assets.
Any abuse or misuse by our employees of our internal platform and system tools, or any unintended or unauthorized actions taken by AI agents or other automated systems using such tools, could result in unauthorized access to or disclosure, modification, or destruction of data; disruption or compromise of our systems or those of our customers, partners, or other third parties; damage to physical assets or operations; potential legal or regulatory liability; and reputational harm to our customers, our partners, and us. Accordingly, any improper conduct, abuse or misuse, intentional or otherwise, of our platform and system tools, or any failure to appropriately constrain AI agents or other automated systems that interact with them, could significantly and adversely harm our business and reputation.
37
We are continuing to implement enhanced access controls and other safeguards for our platform controls and system tools in an effort to further improve security and reduce the risks of human error, malfeasance, and unintended or unauthorized actions by AI agents and other automated systems. These safeguards may include restrictions on access, privileges, network connectivity, execution environments, and tool use, as well as monitoring and other controls designed to detect or limit unauthorized activity. Such measures may not be sufficient to prevent all unintended or unauthorized actions. If it becomes necessary to further restrict the availability, capabilities, or use of our platform and system tools by our employees or AI systems in response to these risks, our ability to develop products, operate efficiently, or deliver high-quality and timely customer support could be harmed.
We rely on third-party software and technology providers for certain essential financial and operational services, and a failure or disruption in, or a material change to, these services could materially and adversely affect our ability to manage our business effectively.
We rely on third-party software and technology providers to provide many essential financial and operational services to support our business, including enterprise resource planning, customer relationship management, artificial intelligence technologies and models, and human capital management. Many of these vendors provide their services to us through cloud-based platforms, APIs, or other hosted services rather than software that is installed and operated on our premises. As a result, we depend on these vendors to provide services that are reliable, secure, available, and compatible with our systems and business requirements.
Our use of third-party AI technologies and models may create additional dependencies on providers whose technologies, infrastructure, security practices, and commercial terms we do not control. Such providers often modify or discontinue models or services, change their functionality or performance, impose or modify usage restrictions or rate limits, increase pricing, experience capacity constraints or service disruptions, or change the terms under which their technologies may be used. Updates to third-party AI models or services may also result in unexpected changes in their performance, behavior, security, or compatibility with our systems. Because we generally do not control the underlying models or infrastructure provided by these third parties, our ability to identify, correct, or mitigate defects, vulnerabilities, outages, or other problems may be limited or dependent upon the provider.
If a third-party technology or AI model on which we rely becomes unavailable, materially changes, no longer meets our security, privacy, performance, legal, or business requirements, or becomes uneconomical to use, we may need to identify and transition to an alternative provider or technology. Such a transition may require significant engineering, testing, operational, or other resources, may not be completed on a timely basis, and may result in disruptions to our operations or the functionality or performance of systems that depend on such technologies.
Any failure, security incident, service disruption, material change, or other deficiency involving these vendors or technologies, or any disruption in our ability to access them, could disrupt our business processes, increase our costs, require us to modify our systems or business practices, and materially and adversely affect our ability to effectively manage our business.
Issues and uncertainty in the development, deployment, and use of AI in our solution, in our business, and by our customers or partners may subject us to liability and may harm our reputation and operating results.
38
We are investing significantly in leveraging AI technologies, including generative AI and AI agents, within our solutions and operations. We are increasingly innovating and expanding offerings on our Connected Operations Platform by integrating AI into our technology and systems. We are also developing and incorporating AI solutions and features into our operations to help drive future growth and efficiency. As with many developing technologies, AI presents risks and challenges that could affect its further development, adoption, and use, and therefore our business. AI algorithms may be flawed. Datasets may be insufficient or of poor quality or contain biased information. Inappropriate or controversial data practices by third parties, data scientists, engineers, and end users of our systems could impair the acceptance of AI solutions. If the recommendations, forecasts, content, or analyses that AI applications assist in producing are or are alleged to be deficient or inaccurate, we could be subjected to competitive harm, potential legal liability, and brand or reputational harm. Our, or our vendors’, use of AI technologies could lead to the unauthorized disclosure of sensitive, proprietary, or confidential information and could lead to new potential cyberattack methods for third parties or be used to increase the frequency, sophistication or intensity of cyberattacks. The impact of AI technology on intellectual property ownership and licensing rights, including copyright, has not been fully addressed by relevant courts or other laws or regulations, and the use of third-party AI technologies in connection with our solution and operations may result in exposure to claims of copyright infringement or other intellectual property misappropriation, or a reduced ability to protect our intellectual property. We may choose to invest in the development and maintenance of proprietary data sets and training models and the development of appropriate protections, safeguards, and policies for handling the processing of data, including transparency of customer data extraction and usage in training models, with our AI features, which may be costly and subject us to legal liability. Increasing use of AI tools, including large language model APIs and related infrastructure, exposes us to growing costs. Token-based and consumption-based pricing models mean that as our use of AI in our solution increases, or as employee adoption scales and use cases expand, our margins may be impacted and our AI-related operating expenses could increase materially. There can be no assurance that we will realize the desired or anticipated benefits from our investments in AI technology in a timely or cost-effective manner.
Some AI scenarios may also present ethical issues. If we enable or offer AI features that are controversial because of their perceived or real impact on human rights, privacy, data protection, employment, or other social issues, we may experience brand or reputational harm.
Additionally, jurisdictions around the world are developing and passing new regulations that apply specifically to the use of AI. Government regulation related to AI use and ethics may expose us to legal liability and/or increase the burden and cost of research and development in this area, and failure to properly remediate AI usage or ethics issues may cause public confidence in AI to be undermined, which could slow adoption of AI in our solution. For example, the European Union Artificial Intelligence Act (“EU AI Act”) imposes a series of legal and technical obligations and restrictions on companies’ use, and development of, AI with varying enforcement dates. Under the EU AI Act, fines can reach up to the greater of €35 million and 7% of global annual turnover. Other countries, including the United States, have begun considering and implementing AI regulations. For example, the Federal Trade Commission (“FTC”) adopted streamlined procedures for AI-related investigations in November 2023; and several bills involving AI have been introduced in Congress. Several states have also passed legislation or regulatory frameworks governing automated decision-making and agentic systems, which may impose heightened compliance obligations and operational restrictions on our development and deployment of AI features.
In addition, our competitors, customers, or other third parties may incorporate AI more successfully than us, and their AI solutions may achieve higher market acceptance than ours, which may result in decreased demand for our solution and us failing to recoup our investments in developing AI-powered offerings. Uncertainty around new and emerging AI technologies may require significant additional investment in these technologies. Any challenges in deploying our AI-based technologies, or the ability of our competitors to do so more effectively, may impair our ability to compete effectively, result in reputational harm, and have an adverse impact on our operating results.
39
If we are not able to maintain, enhance, and protect our brand, our business, financial condition, and results of operations may be harmed.
We believe that maintaining, enhancing, and protecting our reputation as a differentiated and category-defining company is critical to our relationships with our existing customers and to our ability to attract new customers. We also believe the importance of brand recognition will increase as competition in our market increases, and that brand and reputation are particularly important in the physical operations industry given the potential impact of any failure of our solution on the physical operations of our customers. In the second quarter of fiscal year 2027, we updated our brand identity, including changes to our logo, typeface, color palette, and other visual elements. Implementing this updated brand identity has required and may require further expenditures and may not achieve its intended benefits, and it could result in customer confusion or otherwise adversely affect our brand recognition or reputation. The successful promotion and protection of our updated brand depends on a number of factors, including our and our channel partners’ marketing efforts and conduct in the marketplace, our ability to continue to develop high-quality solutions, our ability to successfully differentiate our Applications from those of competitors, and our ability to obtain and maintain intellectual property and other protections related to our brand. In addition, users of our solution, independent industry analysts, and other media commentators, and participants in online forums, social media platforms, and other digital channels, provide reviews of our solution and our competitors’ products, which could influence the perception of the relative value of our solution in the marketplace. If these reviews are negative, or less positive as compared to those of our competitors’ products, our reputation and brand may be harmed.
The promotion of our brand requires us to make substantial expenditures, and we anticipate the expenditures will increase as our market becomes more competitive, as we expand into new markets, and as more sales are generated through our channel partners. Our brand promotion activities may not generate customer awareness or yield increased revenue, and even if they do, any increased revenue may not offset the expenses we incur in building our brand. If we do not successfully maintain and enhance our brand, our business may not grow, we may have reduced pricing power relative to competitors, and we could lose customers or fail to attract potential customers, any of which would harm our business, financial condition, and results of operations.
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Unregistered Sales of Equity Securities
None.
Issuer Purchases of Equity Securities
None.
Item 3. Defaults Upon Senior Securities
Not applicable.
Item 4. Mine Safety Disclosures
Not applicable.
40
Item 5. Other Information
Rule 10b5-1 Trading Arrangements
During the quarterly period ended August 1, 2026, no director or officer, as defined in Rule 16a-1(f), adopted terminated
41
Item 6. Exhibits
EXHIBIT INDEX
| Incorporated by Reference | ||||||||||||||||||||||||||||||||
| Exhibit Number | Description | Form | File Number | Exhibit | Filing Date | |||||||||||||||||||||||||||
| 8-K | 001-41140 | 3.1 | 6/1/2026 | |||||||||||||||||||||||||||||
| 8-K | 001-41140 | 3.2 | 6/1/2026 | |||||||||||||||||||||||||||||
| 10-Q | 001-41140 | 4.1 | 6/9/2026 | |||||||||||||||||||||||||||||
| 10-Q | 001-41140 | 4.3 | 6/9/2026 | |||||||||||||||||||||||||||||
| 8-K | 001-41140 | 10.1 | 6/1/2026 | |||||||||||||||||||||||||||||
| 101.INS | Inline XBRL Instance Document—the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. | |||||||||||||||||||||||||||||||
| 101.SCH* | Inline XBRL Taxonomy Extension Schema Document | |||||||||||||||||||||||||||||||
| 101.CAL* | Inline XBRL Taxonomy Extension Calculation Linkbase Document | |||||||||||||||||||||||||||||||
| 101.DEF* | Inline XBRL Taxonomy Extension Definition Linkbase Document | |||||||||||||||||||||||||||||||
| 101.LAB* | Inline XBRL Taxonomy Extension Label Linkbase Document | |||||||||||||||||||||||||||||||
| 101.PRE* | Inline XBRL Taxonomy Extension Presentation Linkbase Document | |||||||||||||||||||||||||||||||
| 104 | Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) | |||||||||||||||||||||||||||||||
| * | Filed herewith. | |||||||||||||||||||||||||||||||
| # | The certifications attached as Exhibit 32.1 and 32.2 accompany this Quarterly Report on Form 10-Q pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, and shall not be deemed “filed” by the registrant for purposes of Section 18 of the Securities Exchange Act of 1934, as amended, and are not to be incorporated by reference into any of the registrant’s filings under the Securities Act of 1933, as amended, irrespective of any general incorporation language contained in any such filing. | |||||||||||||||||||||||||||||||
| + | Indicates management contract or compensatory plan. | |||||||||||||||||||||||||||||||
42
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
| SAMSARA INC. | ||||||||
Date: September 8, 2026 | By: | /s/ Sanjit Biswas | ||||||
| Sanjit Biswas | ||||||||
| Chief Executive Officer | ||||||||
| (Principal Executive Officer) | ||||||||
Date: September 8, 2026 | By: | /s/ Dominic Phillips | ||||||
| Dominic Phillips | ||||||||
| Chief Financial Officer | ||||||||
(Principal Financial Officer) | ||||||||
43