Summary
Asana reported revenue of $205.1 million for the first quarter of fiscal 2027, up 9.5% from the prior-year quarter. Revenue grew at a steady pace while the losses shrank much faster. GAAP operating loss narrowed to $15.2 million. GAAP net loss narrowed to $14.4 million, or $0.06 per share. Operating margin improved 16.0 percentage points to -7.4%, which the company described as a record first-quarter GAAP operating margin. Gross margin did not follow. It slipped 2.1 percentage points to 87.6%, pressured by higher third-party hosting costs, personnel costs, and amortization of capitalized software development costs.
Customer and backlog data point to steady, if unspectacular, expansion. Asana ended the quarter with 26,103 Core customers, those spending $5,000 or more on an annualized basis, up 7% year over year. Revenue from Core customers grew 10%. Customers spending $100,000 or more on an annualized basis reached 817, up 12%. Dollar-based net retention rate was 96%, up from 95% a year earlier, and the chief financial officer framed the result as the fourth consecutive quarter of improvement. Remaining performance obligations rose 23.2% to $518.1 million, well ahead of the revenue growth rate. Deferred revenue was $322.9 million, up 11.7% year over year, although the MD&A attributes a $10.7 million decrease in deferred revenue during the quarter to lower subscription billings. The backlog picture is not uniformly strong.
Profitability still leans on non-GAAP adjustments. Non-GAAP operating income was $23.6 million, or 11.5% of revenue, compared with $8.1 million, or 4.3% of revenue, in the prior-year quarter. Non-GAAP net income was $24.4 million, and non-GAAP diluted net income per share was $0.10. The gap to GAAP comes mostly from $38.3 million of stock-based compensation and related charges, plus $2.2 million of restructuring costs and $0.5 million of acquisition-related costs. Cash is where the quarter looks strongest. Operating cash flow was $40.2 million, up 495.0% year over year, and adjusted free cash flow was $34.4 million versus $9.9 million a year earlier. Capital expenditures were $2.8 million. The company repurchased 7.4 million shares of Class A common stock for $45.0 million, leaving $154.5 million available under its repurchase program. Cash, cash equivalents, and marketable securities totaled $424.6 million on April 30, 2026, against an accumulated deficit of $2,209.1 million.
Guidance for the second quarter of fiscal 2027 implies growth of 8.2% to 9.2% on a range of $213 million to $215 million, including roughly 50 basis points of contribution from the StackAI acquisition. Management guided non-GAAP operating income of $18 million to $20 million, an 8.5% to 9.3% operating margin, and non-GAAP net income per share of $0.08 to $0.09 on about 237 million diluted shares. For the full fiscal year, the outlook implies growth of 8.2% to 9.2% on a range of $855.5 million to $863.5 million, also including roughly 50 basis points from StackAI, a non-GAAP operating margin of at least 9.75%, and non-GAAP net income per share of $0.37 on roughly 239 million diluted shares.
Two corporate actions shape the rest of the year. On May 28, 2026, Asana announced the acquisition of StackAI, a privately held AI company whose no-code platform lets businesses build, test, and deploy custom agents and complex workflows. Management expects the deal to accelerate the broader AI platform strategy and to strengthen the company's position as the operating system for human-agent teams. In March 2026, Aziz Megji became chief financial officer after Sonalee Parekh's resignation, and Veronica Sosa became chief accounting officer. The risk list is familiar. Macroeconomic conditions, including inflation, fluctuating interest rates, tariffs, and geopolitical unrest, continue to weigh on IT spending and lengthen sales cycles. AI-assisted search has disrupted how small and midsize businesses discover products, and management expects that dynamic to persist through fiscal 2027 despite modest quarter-over-quarter traffic recovery and better web conversion and retention. Competition in a rapidly evolving market and integration risk around StackAI round out the picture.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2027 | Q4 FY2026 | QoQ | Q1 FY2026 | YoY |
|---|---|---|---|---|---|
| Revenue | $205.1M | $205.6M | -0.2% | $187.3M | +9.5% |
| Gross profit | $179.7M | $180.6M | -0.5% | $168.0M | +6.9% |
| Gross margin | 87.6% | 87.8% | -0.2 pp | 89.7% | -2.1 pp |
| Research & development | $66.1M | $73.2M | -9.7% | $75.1M | -12.0% |
| Sales & marketing | $92.5M | $100.2M | -7.7% | $99.8M | -7.4% |
| General & administrative | $36.4M | $41.2M | -11.7% | $37.0M | -1.6% |
| Total operating expenses | $194.9M | $214.6M | -9.1% | $211.9M | -8.0% |
| Operating income (loss) | -$15.2M | -$34.0M | +55.2% | -$43.9M | +65.3% |
| Operating margin | -7.4% | -16.5% | +9.1 pp | -23.4% | +16.0 pp |
| Net income (loss) | -$14.4M | -$32.2M | +55.3% | -$40.0M | +64.0% |
| Net margin | -7.0% | -15.7% | +8.7 pp | -21.4% | +14.4 pp |
| Diluted EPS | -$0.06 | -$0.14 | +$0.08 | -$0.17 | +$0.11 |
| Customers | 728 | 25,928 | -97.2% | 607 | +19.9% |
| Net retention rate | 96.0% | 96.0% | ±0.0 pp | 95.0% | +1.0 pp |
Risks
The filing materially expands AI as a competitive threat: competitors may incorporate AI or machine learning to improve their offerings, and AI-enabled software development tools may reduce the research and development costs of building work management solutions, lowering barriers to entry and enabling customers to build their own internal tools. Asana also states that the introduction and acceptance of AI-assisted technologies has impacted traditional search engine user discovery of its products, particularly by small and midsize businesses, and expects these shifting dynamics to continue to impact it throughout fiscal year 2027.
The filing discloses a specific incident: in June 2025, Asana suffered a flaw in the implementation of its Model Context Protocol feature that potentially led to certain data in the instances of certain customers being accessible to other users of that feature. It also notes ongoing phishing attempts against Asana employees and fraudulent processes designed to circumvent controls for account takeover.
Macroeconomic conditions including inflation, fluctuating interest rates, tariffs and changes in trade agreements, and geopolitical unrest have led to longer sales cycles, reduced renewal rates, reduced customer spend and delayed payments. The company's dollar-based net retention rate was 96% as of April 30, 2026, up from 95% as of April 30, 2025, but still below 100%, indicating net contraction within the existing customer base.
The flagship Asana collaborative work management platform currently accounts for substantially all revenue through seat-based licenses, and revenue from add-on products depends on licenses to that core platform. The filing warns that changes in customer preferences may have a disproportionately greater impact on Asana than if it offered products independent of the core platform.
In March 2026 the company announced the resignation of former Chief Financial Officer Sonalee Parekh and the appointment of Aziz Megji as CFO effective March 24, 2026, and appointed Veronica Sosa as Chief Accounting Officer effective March 11, 2026. The filing notes Asana has no key person insurance on any employees and faces intense competition for executive, engineering and sales personnel in the San Francisco Bay Area and other office locations.
AI-related laws such as the EU AI Act, the Colorado Artificial Intelligence Act and the California AI Transparency Act impose transparency, conformity, risk assessment and human oversight obligations on Asana's AI features. Non-compliance under the EU AI Act can carry administrative fines of up to 35 million Euros or 7% of total worldwide annual turnover for the preceding financial year, whichever is higher.
Gross margin was 87.6% in the quarter ended April 30, 2026, down 2.1 percentage points from 89.7% in the prior-year quarter, as cost of revenues rose 32% on higher third-party hosting costs, personnel-related costs and amortization of capitalized software development costs. The company expects to continue investing in AI features and infrastructure, which may further pressure margins.
On May 28, 2026 the company announced the acquisition of Eigen Inc. (StackAI), a privately held AI company offering a no-code AI automation platform, intended to accelerate its AI platform strategy. The filing flags risks from acquisitions including potentially significant amortization costs, possible write-downs, and integration of acquired systems and security programs.
SaaS KPIs
All quarters →Free cash flow
Non-GAAP operating margin
Net Revenue Retention
Non-GAAP gross margin
Adjusted free cash flow
Customers Spending $100,000+ (annualized)
Dollar-Based Net Retention Rate (Core customers)
Non-GAAP operating income
Summary, forecast, risks and KPIs are extracted from Asana, Inc.'s SEC filings for Q1 FY2027 (10-Q / 10-K and the 8-K earnings release); GAAP figures in the summary are checked against the reported XBRL data. They can contain errors; the filings are authoritative. Processed Oct 2, 2026.