Summary
AvePoint reported second quarter fiscal 2026 revenue of $124.5 million, up 22.0% from the prior-year quarter. SaaS revenue grew 27% and represented 79% of total revenue. Total ARR was $465.1 million as of June 30, 2026, up 27% year over year and up 24% adjusted for FX. Dollar-based gross retention was 89%, while dollar-based net retention was 111% on a reported basis and 110% adjusted for FX. Management tied the demand to growing need for trusted AI and said the company delivered record net new ARR. Gross profit was $91.0 million, up 20.5% from the prior-year quarter, but gross margin slipped to 73.1% from the prior-year quarter. Operating income was $10.2 million, up 44.1% from the prior-year quarter, and operating margin rose to 8.2% from the prior-year quarter. Net income was $27.6 million, up 921.9% from the prior-year quarter, and diluted EPS was $0.12. The company said a valuation allowance release on certain deferred tax assets drove a large income tax benefit and helped net income.
Cash generation was mixed. For the six months ended June 30, 2026, operating cash flow was $40.2 million, up 93.6% from the prior-year period. In the second quarter alone, operating cash flow was $15.9 million, down 21.4% from the prior-year quarter. Capital expenditures were $1.2 million in the quarter, up 25.1% from the prior-year quarter, and $2.5 million for the six months, flat compared with the prior-year period. Deferred revenue was $213.1 million, up 25.2% from the prior-year quarter. Remaining performance obligations were $559.4 million, up 21.5% from the prior-year quarter. The balance sheet remains strong, with no outstanding debt. Non-GAAP operating income was $20.3 million, and non-GAAP operating margin was 16.3%, down from 18.4% in the prior-year quarter. The company repurchased shares under its existing program during the six months, and management said existing cash and cash equivalents plus operating cash flows should cover working capital and capital expenditure needs for at least the next twelve months.
Management raised full-year ARR guidance. For the third quarter of 2026, the company expects total revenues to grow 18% at the midpoint, or 19% on a constant currency basis, and non-GAAP operating income of $21.0 million to $22.0 million. For the full year 2026, AvePoint now expects total ARR of $522.1 million to $528.1 million, or year-over-year growth of 26% at the midpoint, with FX-adjusted ARR growth also 26% at the midpoint. Full-year total revenues are guided to grow 22% at the midpoint, and 21% on a constant currency basis. Full-year non-GAAP operating income is guided to $86.4 million to $88.4 million. The company plans to increase expense plans for the second half of the year, and the outlook reflects an expected foreign exchange headwind.
The quarter's operational news included the third annual State of AI report, which found that organizations lack the trust layer required to scale AI safely, and new advancements to the AvePoint Confidence Platform. The company serves more than 28,000 organizations and 6,000 channel partners. Risks remain familiar for a fast-growing software vendor. The market is dynamic and highly competitive, and competitors are developing new software and cloud services. Customer preferences evolve quickly. Investments in infrastructure, research and development, marketing, and geographic expansion will increase operating costs and may decrease operating margins. AvePoint depends on attracting and retaining qualified employees. Demand is tied to global macroeconomic and geopolitical factors that could affect trade, currency exchange rates, regional economies, and the global economy. International operations provide a significant portion of revenue and expenses, so foreign exchange moves may significantly affect results. Revenue also has seasonality, with the first quarter historically the lowest and the fourth quarter the highest, though those patterns are not necessarily indicative of future results. ARR is not a forecast of future revenue, and active contracts may or may not be extended or renewed.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2026 | Q1 FY2026 | QoQ | Q2 FY2025 | YoY |
|---|---|---|---|---|---|
| Revenue | $124.5M | $117.2M | +6.2% | $102.0M | +22.0% |
| Gross profit | $91.0M | $85.4M | +6.6% | $75.5M | +20.5% |
| Gross margin | 73.1% | 72.8% | +0.3 pp | 74.0% | -0.9 pp |
| Research & development | $16.6M | $13.8M | +20.4% | $13.0M | +27.8% |
| Sales & marketing | $45.5M | $42.0M | +8.4% | $35.8M | +27.3% |
| General & administrative | $18.7M | $16.9M | +10.7% | $19.7M | -5.3% |
| Total operating expenses | $80.8M | $72.6M | +11.2% | $68.4M | +18.0% |
| Operating income (loss) | $10.2M | $12.7M | -19.7% | $7.1M | +44.1% |
| Operating margin | 8.2% | 10.9% | -2.6 pp | 7.0% | +1.3 pp |
| Net income (loss) | $27.6M | $15.3M | +80.8% | $2.9M | +853.0% |
| Net margin | 22.1% | 13.0% | +9.1 pp | 2.8% | +19.3 pp |
| Diluted EPS | $0.12 | $0.07 | +$0.05 | $0.01 | +$0.11 |
| Net retention rate | 111.0% | 111.0% | ±0.0 pp | 112.0% | -1.0 pp |
Risks
Net income rose 921.9% to $27.6M in FY2026 Q2 and 597.6% to $42.8M year to date, driven largely by a $19.9 million release of the valuation allowance on certain deferred tax assets during the six months ended June 30, 2026. That discrete benefit is not expected to recur, and the company continues to maintain valuation allowances against certain U.S. state and foreign deferred tax assets.
Non-GAAP operating margin decreased to 16.3% in FY2026 Q2 from 18.4% in the prior-year quarter, which management attributed to its plan to increase investments across the business in 2026. GAAP gross margin also fell to 73.1% from 74.0% in the quarter, reflecting higher hosting and personnel costs.
Total ARR increased 27% year over year to $465.1 million as of June 30, 2026 but only 24% when adjusted for FX, and EMEA revenue growth of 26.6% in FY2026 Q2 narrowed to 24.2% on a constant currency basis. A significant portion of revenue and expenses is denominated in currencies other than the U.S. dollar, so FX moves can materially affect reported results.
Term license and support revenue declined 16.4% year to date to $19.6 million, and services revenue, which grew 8.6% in FY2026 Q2, is not recurring in nature and is expected to fluctuate period to period. Continued mix shift toward SaaS changes revenue recognition timing and can cause quarterly volatility.
MD&A describes the software and cloud services markets as dynamic and highly competitive, with competitors developing new software and deploying competing cloud services while customer preferences and AI-driven workloads evolve rapidly. The company must keep pace with this environment, and ongoing investments in infrastructure, research and development, marketing and geographic expansion will increase operating costs.
Management states that success is highly dependent on attracting and retaining qualified employees, and it competes globally for talent. Personnel costs rose $7.0 million in sales and marketing and $2.6 million in research and development during FY2026 Q2, highlighting wage pressure on operating expenses.
Demand for the company's software and services is correlated to global macroeconomic and geopolitical factors, which MD&A says remain dynamic and could materially adversely affect global trade, currency exchange rates and regional economies, and in turn increase costs or reduce sales and earnings.
MD&A notes quarterly revenue fluctuates and does not necessarily grow sequentially, with the first quarter historically the lowest revenue quarter and the fourth quarter the highest, and that timing of new product introductions and revenue mix can significantly impact reported revenue.
SaaS KPIs
All quarters →Non-GAAP operating margin
Total ARR
Dollar-based net retention rate
Dollar-based gross retention rate
Non-GAAP operating income
Summary, forecast, risks and KPIs are extracted from AvePoint, Inc.'s SEC filings for Q2 FY2026 (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.