Summary
Procore reported second quarter fiscal 2026 revenue of $375.2 million, up 15.8% from the prior-year quarter. Gross profit was $299.8 million, up 17.0%, and GAAP gross margin was 79.9%, up 0.8 percentage points. Non-GAAP gross margin was 84%, and non-GAAP operating margin was 21%. The company reached GAAP operating profitability: operating income was $4.3 million, swinging to a profit from a loss in the prior-year quarter, and operating margin was 1.2%, up 10.5 percentage points. Net income was $16.9 million, swinging to a profit from a loss in the prior-year quarter, and diluted EPS was $0.11, swinging to a profit from a loss in the prior-year quarter. For the first half, revenue was $734.5 million, up 15.7%, and net income was $7.8 million, swinging to a profit from a loss in the prior-year period.
Operating cash flow was $87.9 million in the quarter, up 185% year over year. Free cash flow was $64.5 million, up 507%. Capital expenditures were $7.0 million, up 135.9%. Deferred revenue was $673.5 million, up 20.1%. Total remaining performance obligations were $1.70 billion, up 30.8%. The company had 2,871 customers contributing more than $100,000 of annual recurring revenue as of June 30, 2026, up 14% year over year, and gross revenue retention was 95%. Those larger customers represented 68% of total ARR, up from 64% a year earlier. ARR mix was 59% from general contractors, 26% from owners, and 15% from specialty contractors.
Management guided third quarter fiscal 2026 revenue in the range of $382 million to $384 million, representing year-over-year growth of 13.3%. It guided third quarter non-GAAP operating margin to 19% to 19.5%. For the full fiscal year 2026, the company guided revenue in the range of $1,510 million to $1,514 million, representing year-over-year growth of 14.5% at the high end, and non-GAAP operating margin to 18.5% to 19.0%. Free cash flow margin for the full fiscal year 2026 is expected to be 19.5%. For the full fiscal year 2027, non-GAAP operating margin is expected to be 25%. The company did not provide GAAP guidance because a reconciliation is not available on a forward-looking basis without unreasonable effort.
Risks include the planned DroneDeploy acquisition for approximately $845.0 million in cash, which Procore agreed to on July 27, 2026. The company entered a debt financing commitment letter with Goldman Sachs Bank USA for up to $700.0 million in a 364-day senior secured bridge loan facility. Integration and financing risks are material. Procore also faces an ongoing lawsuit with Oracle, which contributed to higher legal fees. Macroeconomic factors such as inflation, interest rates, tariffs, and geopolitical conditions could affect customers' spending. The company has a history of losses and maintains a full valuation allowance on net U.S. deferred tax assets. It repurchased 1,765,560 shares for $100.0 million under a $300.0 million stock repurchase program that expires on November 3, 2026. The DroneDeploy deal is expected to close later this year and is subject to closing conditions.
Revenue growth remained broad based. About 88% of the quarterly revenue increase came from existing customers, and 12% came from new customers acquired during the quarter. For the first half, 84% of the revenue increase came from existing customers and 16% from new customers. Non-U.S. revenue was 15% of total revenue for both the first half of 2026 and 2025. The company added portfolio management and capital planning capabilities, launched a connected Common Data Environment, and introduced an expanded Procore AI experience. In January 2026, it acquired Toric Labs, Inc. (d/b/a Datagrid) to accelerate its AI strategy, and in January 2025, it acquired Novorender AS. These product moves aim to deepen the platform's role in construction workflows.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2026 | Q1 FY2026 | QoQ | Q2 FY2025 | YoY |
|---|---|---|---|---|---|
| Revenue | $375.2M | $359.3M | +4.4% | $323.9M | +15.8% |
| Gross profit | $299.8M | $287.8M | +4.2% | $256.2M | +17.0% |
| Gross margin | 79.9% | 80.1% | -0.2 pp | 79.1% | +0.8 pp |
| Research & development | $93.3M | $85.6M | +9.1% | $88.9M | +5.0% |
| Sales & marketing | $145.8M | $149.2M | -2.3% | $141.9M | +2.7% |
| General & administrative | $56.3M | $68.7M | -18.0% | $55.7M | +1.2% |
| Total operating expenses | $295.5M | $303.5M | -2.6% | $286.5M | +3.1% |
| Operating income (loss) | $4.3M | -$15.7M | +127.6% | -$30.3M | +114.3% |
| Operating margin | 1.1% | -4.4% | +5.5 pp | -9.3% | +10.5 pp |
| Net income (loss) | $16.9M | -$9.1M | +286.0% | -$21.1M | +180.2% |
| Net margin | 4.5% | -2.5% | +7.0 pp | -6.5% | +11.0 pp |
| Diluted EPS | $0.11 | -$0.06 | +$0.17 | -$0.14 | +$0.25 |
Risks
The company faces competition from general purpose AI solutions and rivals that may incorporate AI more quickly or successfully than it does; it is investing heavily in Procore AI and acquired Datagrid in January 2026, but failure to bring AI offerings to market effectively could harm its competitive position.
Its use of AI is subject to rapidly evolving laws, including the EU AI Act, which can impose fines of up to 35 million euros or 7% of total worldwide annual revenue; compliance may increase operating costs, require changing business practices, or limit AI deployment.
Overall sentiment in the construction industry remains uncertain due to macroeconomic factors, and because pricing is tied to customers' annual construction volume, a decrease in construction volume or reduced government infrastructure spending could reduce demand and revenue.
Effective November 10, 2025, founder and former President and CEO Craig F. Courtemanche, Jr. resigned and Dr. Ajei S. Gopal was appointed President and CEO; recent leadership changes may create uncertainty and make preserving culture and retaining key personnel more challenging.
On July 27, 2026, the company agreed to acquire DroneDeploy for approximately $845.0 million in cash, with up to $700.0 million committed under a 364-day senior secured bridge facility; financing, integration, and failure to realize benefits could adversely affect results.
The company states that while revenue has continued to increase, its revenue growth rate has declined and may continue to decline as a result of its ability to manage growth and investments, including the evolved GTM operating model, macroeconomic conditions, and maturation of its business.
The evolved GTM operating model transition to a general manager model begun in July 2024 may not realize expected benefits; sales cycles for larger enterprises, owners, and governmental entities are long and unpredictable, increasing upfront sales costs and reducing predictability.
General and administrative expenses for the six months ended June 30, 2026 increased 12% year over year, driven in part by an $11.3 million increase in legal fees predominantly related to an ongoing lawsuit with Oracle America, Inc. and certain affiliates.
Achieving FedRAMP Moderate authorization for Procore for Government in January 2026 may increase visibility and the risk of nation-state and other threat actors targeting its systems; any compromise could cause regulatory actions, litigation, and reputational harm.
SaaS KPIs
All quarters →Non-GAAP Gross Margin
Non-GAAP Operating Margin
Free Cash Flow
Customers > $100K ARR
Gross Revenue Retention
Current RPO (cRPO)
Total RPO
Summary, forecast, risks and KPIs are extracted from PROCORE TECHNOLOGIES, 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.