Let me now turn into our AI strategy. Over the last several quarters, we've talked about our AI strategy through three pillars. Powering AI system with our data, building an AI native product ourselves, and expanding distribution through the AI ecosystem. We are seeing strong progress across all three. First, we are powering LLM and AI agent. We continue to see strong demand from leading AI companies for our digital data for both pre-training and post-training use case. But we're also seeing increased demand from AI agents. Agents need trusted structure and comprehensive information about the digital world in order to perform their tasks efficiently. Our data is built for both human and agent, and that is becoming increasingly important. Second, we're building our own AI-native products. Gen AI intelligence is shaping up as a huge opportunity. It's a lucrative, fast-growing market that is top of mind for every CMO and executive at large enterprise right now. We're already seeing an early sign we can win here and become a leader at this category. Our solution helps brands understand how they can show up across generative AI platforms. We think it's an entirely new category, and our data gives us a real edge. And earlier this year, we launched SimilarWeb AI Studio. The response has been extremely strong. AI Studio changed the way people interact with SimilarWeb. Instead of needing to know exactly which report to open or which document to use, the user can simply ask a business question in natural language and receive an actionable answer with insight and recommendation. Please dramatically expand who can use SimilarWeb. And importantly, it created a new consumption-based monetization model. We believe this is the direction the industry is moving. Third, we are expanding distribution. Increasingly, research and decision-making are happening inside AI platforms. So we want SimilarWeb to be there. Our data available through MCP on Cloud and ShedGPT. During the quarter, we expanded our relationship with Proplexity to bring SimilarWeb digital data directly into its AI-native workflow. And we expand our partnership with Manos following the successful launch of SimilarWeb data on the platform. Those partnerships are more than integration. They are new distribution channels for SimilarWeb. They allow us to reach users who we couldn't not reach through our traditional go-to-market motion. They expand our time, and they reinforce our position as a critical data layer for AI-driven research and decision-making. So now, let me walk you through what I believe is happening. First, our core business is getting healthier. Growth retention is improving. NRL is inflicted. Self-productivity is improving. And we are seeing better expansion across enterprise customers. Second, our enterprise strategy is working. We are seeing larger contracts, longer commitments, more multi-product relationships, and increasing demand from the world's largest companies for our digital data. And third, AI is dramatically expanding the opportunity for our data. It creates new customers, new use cases, new distribution channels, and new ways to monetize consumption. Those three things reinforce each other, and this is why I believe Q2 represents an important inflection point for similar web. And as I have to say before, AI is the engine, but data is the fuel. Regarding the CEO search, we are making good progress, and we are interviewing very strong candidates. And with that, I will hand it over to Ron, our CFO. Thank you all.
It is a great feeling to deliver a strong set of results and raise guidance for the year. I'll provide highlights of our financial performance and guidance for the third quarter and the full year of 2026. Turning to our quarterly results, we generated $77.2 million of revenue in Q2, a 9% increase year over year and above the guidance range we provided. Revenue growth was driven by good performance across the book of business, including new sales and upsells, as well as growth in AI-related revenues that reached 13% of revenues in the second quarter, up from 11% at the end of the fourth quarter of 2025. I would like to remind you that the second quarter of 2025 provided a tough comparison for this quarter. We expect revenue growth to accelerate in the second half of 2026, supported by the growth in ARR in the second quarter, and the accelerated momentum in our business as all discussed. Non-gap operating profit for the quarter was $6.5 million, the second and 8% margin compared to $2.4 million in the second quarter of 2025. Non-GAAP operating profit was also above our guidance range thanks to top-end growth and disciplined cost control that more than mitigated ethics headwinds. We continue our efforts to offset the headwinds to profit presented by the strengthening of the Israeli shekel versus the U.S. dollar. As a reminder, approximately half of our employees are based in Israel. Non-GAAP finance expenses were $108,000, and non-GAAP tax expense was $1.2 million in the quarter, compared to $86,000 and $1.2 million in the second quarter of 2025. To help with your modeling, we expect these items to remain approximately at this level on a quarterly basis for the rest of the year. Non-GAAP diluted earnings per share were $0.06 compared to $0.01 in Q2 2025. ARR contracted under multi-year contracts continues to expand to 56% of ARR from 57 last deal. We believe that this metric is very important and demonstrates the durability of our revenues and the importance of our data to our customers. good cash generation and strong balance sheet are critical for business at any stage we generated 8.7 million dollars of no monetary cash flow and 11 free cash for margin despite the half extendings we believe we will generate positive no monetary cash flow on a quarterly basis going forward we ended the quarter with approximately 73 point million dollars of cash cash equivalents and no debt. We also have an available line of credit of $75 million. Our remaining performance obligations, RPO, totaled $345 million at the end of Q2, up 26% year-over-year.
We expect to recognize approximately 66% of total RPO as revenue over the next 12 months.
The growth in RPO provides us with confidence in our full year guidance. We are also proud that our referred revenue increased to a total of $141 million, a 21% increase here over the year. In Q2, overall NRR was 100% across all customers and 107% for customers with over $100,000 of ARR. We are proud of the improvement in NRR in the quarter, which came true earlier than expected. We expect further improvement in NRR over 2026. At the end of the second quarter, we had 1,815 customers, with RR above 25,000, compared to 1,809 in 2025. This sequential trend reflects our decision to prioritize go-to-market resources and focus on large-scale opportunities within our existing customer base over smaller inbound SMB deals. Consistent with this focus, the average account value for this cohort grew 19% year-over-year to 149,000. The number of customers today around over 100K increased to 473 at the end of Q2, up 9% compared to 2025. Average account value for this customer cohort increased 18% to $438,000 compared to 2025. We believe that accounts generate more than 25K and 100K of ARR, that accounts for 90% and 69% of ARR, respectively, demonstrate that SimilarWeb is an enterprise-focused data company. Moving to guidance. For the full year of 2026, we are raising our revenue guidance range and expect total revenue in the range of $314 million to $318 million, representing approximately 12% year-over-year growth at the midpoint of the range. In Q3, 2026, we expect total revenue in the range of $80.5 million to $82.5 million, representing 17.5% year over-year growth at the midpoint, accelerating versus Q2, 2026. For the full year, we are raising our guidance for non-GAAP operating profit to be between $24 million and $26 million. Non-GAAP operating profit for the third quarter of 2026 is expected to be in the range of $7.5 million to $9.5 million. With that, Owe and I are ready to take to answer your questions, following Q&A, Owe will share some closing remarks. Operator, please open the line for questions.
Operator
Thank you. At this time, we will open the floor for questions. If you'd like to ask a question, please press star 1 on your telephone keypad. To remove yourself from queue, you may press star 2. Again, that is star 1 to ask a question. And we'll take our first question from Ramo Lin-Chao with Barclays. Please go ahead. Your line is open.
And congratulations. That's an amazing evolution. Or can you talk a little bit more about those customers that you signed and they're kind of showing up in the pipeline? Is this kind of using the similar rep data in a much broader sense than we've seen classically? And, you know, in theory, if that's the case and we open it up for more end users, then in a way the sky is the limit because, like, you should, like, every single customer could do a lot more with your data. So that we – it sounds almost like we're at the beginning of a very great journey here.
Can you talk a little bit more on that? yeah so first of all yes thank you for for the question and and yes you're right the most advanced enterprise are now realized that with AI they can get they can first crunch much more data and they can get much more better insight and recommendation and the I dramatically for the same data is now much higher and they can consume much more data so we're seeing this trend it's very exciting and and we're very happy about it and uh we we think that we continue to see this great success with the onboarding more enterprise to this to use our data in that approach and then run like if you think about it like where are we sitting on this new approach of getting against the big enterprise where are we on on seals capacity etc like you know can the organization can support the growth that potentially is coming your way thank you and right now yes we we we are set up correctly we're starting with with the engagement we currently have in our book of business we already work with the biggest and best enterprise in the world and we we start rolling up you know and start increasing those engagements okay perfect thank you congrats thank you we'll
Operator
take our next question from Ken wall with Oppenheimer and company please go ahead your line is open it's fantastic thank you for thank you for taking my question I think you guys mentioned that you know NRR potentially could trend up still I'm just looking at the levels of you know there's a big step up what gives you the confidence there how much of that is mechanical I recall you guys already were exiting at a pretty high rate after q1 and how much of that is kind of underlying activity that you're seeing that gives you confidence that that number could keep trending higher?
Yeah, we have a very, very high confidence because the NRR, we report to the market, as we said, is the average of the previous four quarters. And because we know that this quarter NRR was very, very high, we already know that the next quarter NRR will continue to increase.
Understood. And Ken, just to add on that, we see very strong, all mentioned in the prepared remarks, very strong GRR trends. And the changes that we did at the beginning of the year that the account management are more focused on expansion, this is a focus on GRR. You already see the fruits of this change. So we see very strong GRR that continues to be at a very strong level, and on top of it, the accounts management that are focused on expansion provides us with the confidence that NRA is going to increase.
Operator
Understood. And then, or just on the really strong pipeline results, again, fantastic in terms of what you guys saw in Q2. When you look at the quarter, how much of that execution was some of the labors from last year you guys kind of refreshed the go-to-market you added capacity how much of that is as you said truly an underlying change in terms of some of the customer actions like where data is now kind of proliferating across organizations or is there still more of that to come I think as I said in there in the earning a lot of it came but just focusing the people on doing the right things that can produce the highest outcome you know one of that that we changed and took some of our best people and just put them in on the alo team
we call it the strategic sales team to build better bigger relationship with the top enterprise and basically unlock this potential so just moving those priorities including the account manager focusing on expansion all of those decision of changing strategy really are bearing the fruits So this is the result of that.
Operator
Thank you. We'll take our next question from Arjun Bhatia with William Blair & Company. Please go ahead. Your line is open.
I'm Arjun Bhatia. Nice quarter, and thank you for taking your question. A couple quarters ago, you saw some variability in, I believe, two large AI deals. I believe you closed one last quarter. But can we get an update on the second? Is that still in the pipeline, and how are you thinking about the timing of closing it?
Yeah, funny enough, this second one is still in the pipeline, and we still think that this is another nice big surprise that can come at the end of the year. And, yeah.
Operator
Okay, thank you. Thank you. We'll take our next question from Patrick Walravens with Citizens. Please go ahead.
Operator
Oh, great. This is Kincaid on for Patrick. Thanks so much for taking the question. Super excited to see this narrative playing out for you guys. is it possible to get a little bit of color when I think about
