Summary
Procore reported first quarter fiscal 2026 revenue of $359.3 million, up 15.7% from the prior-year quarter. Gross profit was $287.8 million, and gross margin reached 80.1%, up 1.0 percentage point. The company still posted an operating loss of $15.7 million, but the operating margin of negative 4.4% improved by 7.3 percentage points. Net loss was $9.1 million, and diluted EPS was negative $0.06. Both the operating loss and the net loss narrowed compared with the prior-year quarter. Operating cash flow was $76.8 million, up 16.2% year over year. Free cash flow, a non-GAAP measure, was $56 million, up 20% year over year. Non-GAAP operating margin was 17%, and non-GAAP gross margin was 84%.
Revenue growth came mostly from existing customers. The filing says about 87% of the increase was attributable to existing customers, while about 13% came from new customers acquired during the quarter. Customers contributing more than $100,000 of annual recurring revenue totaled 2,795 as of March 31, 2026, up 16% year over year. Gross revenue retention rate was 95% in the first quarter. Deferred revenue, current portion, was $655.4 million, up 17.0% year over year. Remaining performance obligations were $1.60 billion, up 23.1% year over year. Non-U.S. revenue was 15% of total revenue for both the 2026 and 2025 periods. Procore also announced an integration with NVIDIA Omniverse DSX Blueprint, was recognized by G2 as a Top 100 Global Software Company for 2026, and appointed Vishal Misra to its board. In January 2026, it acquired Toric Labs, which does business as Datagrid, to accelerate its agentic AI strategy.
Second quarter 2026 guidance puts the top line at $364 million to $366 million, which the company said represents year-over-year growth of 12% to 13%, with non-GAAP operating margin of 17.5% to 18.5%. For the full year 2026, management guided the top line to $1,499 million to $1,503 million, representing year-over-year growth of 13.6% at the high end. Full-year non-GAAP operating margin is expected to be 18% to 18.5%, and free cash flow margin is expected to be 19%. Management said the quarter's performance gives it confidence and it increased the full-year outlook.
The outlook comes with clear risks. Macroeconomic factors such as inflation, interest rates, tariffs, and geopolitical conditions could affect customer spending. The company's go-to-market model transition may cause near-term disruptions. Competition and the ability to integrate acquisitions, including Datagrid and Novorender, remain challenges. An ongoing lawsuit with Oracle added legal costs and contributed to higher general and administrative expenses. Procore continues to carry a history of operating losses and may need additional capital. The company also maintains a full valuation allowance for net U.S. deferred tax assets.
Capital allocation included stock repurchases. During the quarter, the company repurchased about 1.8 million shares under its authorized stock repurchase program. The program expires on November 3, 2026. Procore ended the quarter with a stronger cash flow profile than a year earlier, but the gap between GAAP operating losses and non-GAAP profitability remains wide because of stock-based compensation and other adjustments. The market will watch whether the go-to-market changes and AI investments translate into durable revenue growth and continued margin expansion.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2026 | Q4 FY2025 | QoQ | Q1 FY2025 | YoY |
|---|---|---|---|---|---|
| Revenue | $359.3M | $349.1M | +2.9% | $310.6M | +15.7% |
| Gross profit | $287.8M | $279.7M | +2.9% | $245.7M | +17.1% |
| Gross margin | 80.1% | 80.1% | -0.0 pp | 79.1% | +1.0 pp |
| Research & development | $85.6M | $97.8M | -12.5% | $87.6M | -2.3% |
| Sales & marketing | $149.2M | $155.8M | -4.3% | $138.7M | +7.6% |
| General & administrative | $68.7M | $68.9M | -0.2% | $55.7M | +23.5% |
| Total operating expenses | $303.5M | $322.5M | -5.9% | $282.0M | +7.6% |
| Operating income (loss) | -$15.7M | -$42.8M | +63.4% | -$36.2M | +56.8% |
| Operating margin | -4.4% | -12.3% | +7.9 pp | -11.7% | +7.3 pp |
| Net income (loss) | -$9.1M | -$37.6M | +75.8% | -$33.0M | +72.4% |
| Net margin | -2.5% | -10.8% | +8.2 pp | -10.6% | +8.1 pp |
| Diluted EPS | -$0.06 | -$0.25 | +$0.19 | -$0.22 | +$0.16 |
Risks
General and administrative expenses rose 23% in the quarter ended March 31, 2026 versus the prior-year quarter, primarily on an $8.8 million increase in legal fees predominantly related to an ongoing lawsuit with Oracle. The 10-Q notes no material changes to the risk factors in the 2025 Form 10-K, so this litigation cost pressure is the most concrete new item highlighted in MD&A.
The company evolved its go-to-market operating model, adding a general manager model and product/technical specialists, and states it has seen, and may continue to see, disruptions and adverse near-term impacts on financial and operating results. Sales and marketing headcount was down 5% and research and development headcount up 11% since March 31, 2025, and the failure to realize benefits from the new model would adversely affect results.
Construction customers' spending, plus the company's own operating expenses and cash flows, remain exposed to elevated inflation and government responses, changing interest rates, capital market volatility, bank failures, foreign exchange swings, trade wars or shifting tariffs, and wars and other conflicts.
The company continues to acquire AI and product technology, including the January 2026 acquisition of Toric Labs (Datagrid) which drove $158.9 million of business combination cash outflows in the quarter ended March 31, 2026. Future success depends on successfully developing or acquiring, marketing, and selling new products, and acquisition-related expenses increased to $4.0 million in the quarter from $2.1 million a year earlier.
Despite positive operating cash flow, the company had an accumulated deficit of $1.4 billion as of March 31, 2026, may not achieve profitability in the foreseeable future, and may need additional capital to execute strategic initiatives, with future requirements dependent on revenue growth, renewal activity, billing timing, acquisitions, and stock repurchases.
The company plans continued investment in technology innovation including Procore AI, with new capabilities needed to attract a broader set of construction stakeholders and defend its system-of-record position. It notes the impact of these product developments is not yet material to the business, leaving execution risk against competitors also building construction AI.
International expansion is described as a major greenfield growth opportunity requiring considerable management attention and resources across multiple languages, currencies, cultures, and differing legal, tax, and regulatory systems. Non-U.S. revenue was 15% of total revenue in both quarters ended March 31, 2026 and 2025, and continued investment may adversely affect near-term operating results.
SaaS KPIs
All quarters →Non-GAAP Gross Margin
Non-GAAP Operating Margin
Free Cash Flow
Customers > $100K ARR
Gross Revenue Retention
Total Remaining Performance Obligations
Current Remaining Performance Obligations (cRPO)
Summary, forecast, risks and KPIs are extracted from PROCORE TECHNOLOGIES, INC.'s SEC filings for Q1 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.