Summary
GitLab reported second quarter fiscal 2025 revenue of $182.6 million, up 30.8% from the prior-year quarter. Gross profit was $161.2 million, up 29.1%. Gross margin was 88.3%, down 1.2 percentage points year over year. The quarter's GAAP operating loss narrowed to $41.0 million, and operating margin was negative 22.5%, up 16.3 percentage points. Net income was $12.9 million, a swing to a profit from the prior-year quarter, and diluted earnings per share was $0.08.
On a non-GAAP basis, operating income was $18.2 million, compared with a non-GAAP operating loss of $4.3 million in the prior-year quarter. Non-GAAP net income was $24.5 million, and non-GAAP diluted net income per share was $0.15. Non-GAAP gross margin was 91%, and non-GAAP operating margin was 10%. These measures exclude stock-based compensation, amortization of acquired intangibles, restructuring charges, and other items. Operationally, GitLab was named a Leader in the first-ever 2024 Gartner Magic Quadrant for AI Code Assistants and announced the general availability of GitLab Duo Enterprise, an AI add-on priced at $39 per user per month. The company also achieved In Process designation at the Moderate impact level from FedRAMP and released its 8th annual Global DevSecOps Report.
Cash generation was mixed. Operating cash flow was $11.7 million, down 56.9% from the prior-year quarter. Non-GAAP adjusted free cash flow was $10.8 million. Capital expenditures were $0.85 million in the quarter, up 207.2% year over year. Deferred revenue was $362.3 million, up 34.8%. Total remaining performance obligations were $747.9 million, up 50.8%. Current remaining performance obligations grew 42% to $475.0 million. Customers with more than $5,000 of ARR reached 9,314, an increase of 19%. Customers with more than $100,000 of ARR reached 1,076, an increase of 33%. The dollar-based net retention rate was 126%.
For the six months ended July 31, 2024, revenue was $351.8 million, up 32.0% from the prior-year period. The GAAP operating loss narrowed to $94.6 million. The GAAP net loss narrowed to $41.7 million. Operating cash flow for the six months was $49.8 million, up 208.6%.
For the third quarter of fiscal 2025, GitLab guided to non-GAAP operating income of $19.0 million to $20.0 million and non-GAAP diluted net income per share of $0.15 to $0.16. For the full fiscal year 2025, the company guided to non-GAAP operating income of $55.0 million to $58.0 million and non-GAAP diluted net income per share of $0.45 to $0.47, assuming approximately 168 million weighted average shares outstanding for the third quarter and the full year. GitLab did not provide a reconciliation of non-GAAP guidance to GAAP because certain items are out of its control or cannot be reasonably predicted.
The risks include intense competition and potential loss of market share, the ability to manage growth and sustain profitability, security and privacy breaches, and rapid technological changes. Other risks include fluctuations in operating results, the incorporation of AI features into its products, customer renewals and expansions, customers staying on free self-managed or SaaS offerings, and general economic conditions such as interest rates, inflation, federal budget uncertainty, capital markets volatility, and instability in the global banking sector. GitLab also faces uncertainty from ongoing BAPA negotiations with U.S. and Dutch tax authorities, which could affect future tax liabilities.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2025 | Q1 FY2025 | QoQ | Q2 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $182.6M | $169.2M | +7.9% | $139.6M | +30.8% |
| Gross profit | $161.2M | $150.4M | +7.2% | $124.9M | +29.1% |
| Gross margin | 88.3% | 88.9% | -0.6 pp | 89.5% | -1.2 pp |
| Research & development | $61.3M | $54.1M | +13.2% | $49.0M | +25.0% |
| Sales & marketing | $97.8M | $92.4M | +5.8% | $92.1M | +6.1% |
| General & administrative | $43.2M | $57.5M | -24.9% | $37.8M | +14.1% |
| Total operating expenses | $202.2M | $204.1M | -0.9% | $178.9M | +13.0% |
| Operating income (loss) | -$41.0M | -$53.6M | +23.6% | -$54.1M | +24.1% |
| Operating margin | -22.5% | -31.7% | +9.2 pp | -38.7% | +16.3 pp |
| Net income (loss) | $12.3M | -$54.6M | +122.5% | -$50.1M | +124.5% |
| Net margin | 6.7% | -32.3% | +39.0 pp | -35.9% | +42.6 pp |
| Diluted EPS | $0.08 | -$0.35 | +$0.43 | -$0.33 | +$0.41 |
| Customers | 129 | 1,025 | -87.4% | 810 | -84.1% |
| Net retention rate | 126.0% | 129.0% | -3.0 pp | 124.0% | +2.0 pp |
Risks
GitLab has implemented AI capabilities including the GitLab Duo suite, which face nascent AI regulations, copyright and IP uncertainty, reliance on third-party AI model vendors, and high computing costs that could adversely affect gross margin, profitability, and cash flow.
GitLab faces intense competition from well-established providers such as Microsoft and Atlassian, including competition involving AI incorporation into services, free or lower-priced offerings, and aggressive pricing that could reduce market share and revenue growth.
Gross margin decreased to 88.3% in FY2025 Q2 from 89.5% in FY2024 Q2, and as the SaaS offering makes up an increasing percentage of total revenue, increased cloud hosting and AI compute costs may further pressure gross margins.
Dollar-Based Net Retention Rate was 126% as of July 31, 2024 compared with 129% as of July 31, 2023, and customers may renew for fewer seats, downtier, or decline to purchase additional products, while free product users may not convert to paying customers.
BAPA negotiations between U.S. and Dutch tax authorities led to a $254.9 million net tax liability recorded in the year ended January 31, 2024 and a net reduction of $38.1 million for the six months ended July 31, 2024; unrecognized tax benefits were $349.9 million as of July 31, 2024, with $159.5 million classified as current tax liability.
Base Customers increased to 9,314 as of July 31, 2024 from 7,815 as of July 31, 2023, placing strain on management and operational and financial resources; failure to manage growth could cause deployment delays, quality declines, and difficulty forecasting revenue and expenses.
Net loss narrowed to $41.7 million for the six months ended July 31, 2024 from $102.5 million for the six months ended July 31, 2023, but GitLab had an accumulated deficit of approximately $1.2 billion as of July 31, 2024 and expects operating expenses to increase, so profitability may not be sustained.
Inflation, volatile interest rates, federal budget and debt ceiling uncertainty, potential government shutdowns, banking sector instability, the U.S. presidential election, and armed conflicts may pressure customer spending, delay purchasing decisions, and lengthen sales cycles.
GitLab's public Handbook and open transparency practices may expose confidential information to competitors, lead to Regulation FD or disclosure control failures, and create reputational or litigation risk.
The DevSecOps Platform relies on open source code and independent contributors; supply-chain cyber attacks or failure of project committees and contributors could delay development, increase expenses, and damage reputation.
Future growth depends in part on channel partners for enterprise, governmental, and international sales; partners may not prioritize GitLab, may provide poor service, or may fail to comply with contractual obligations.
Security breaches may arise from AI-related sensitive data exposure, insufficient data anonymization, system misconfiguration, or cyber attacks; a breach could cause litigation, regulatory fines, contract termination, and reputational harm.
GitLab typically receives a higher percentage of annual orders from new and renewal customers in the last two fiscal quarters due to customer budget approval processes, which can cause period-to-period fluctuations in financial results.
SaaS KPIs
All quarters →Dollar-Based Net Retention Rate
Customers with more than $100,000 of ARR
Customers with more than $5,000 of ARR
Non-GAAP Gross Margin
Non-GAAP Operating Margin
Total RPO
Non-GAAP Adjusted Free Cash Flow
cRPO
Summary, forecast, risks and KPIs are extracted from Gitlab Inc.'s SEC filings for Q2 FY2025 (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.