Summary
Samsara reported $153.5 million in revenue for the second quarter of fiscal 2023, up 51.9% from the prior-year quarter. Annual recurring revenue reached $662.8 million, up 52% year over year. The company ended the quarter with 989 customers generating more than $100,000 in ARR, up 61% year over year. Remaining performance obligations stood at $1.19 billion. Those metrics point to steady demand for the Connected Operations Cloud, which helps businesses with physical operations use IoT data to improve safety, efficiency, and sustainability. Samsara sells subscriptions to its cloud platform, and most revenue comes from those subscriptions. Its customers span transportation, wholesale and retail trade, construction, field services, logistics, utilities and energy, government, healthcare and education, manufacturing, and food and beverage. The company's subscription contracts are typically multi-year and non-cancelable, which supports revenue visibility.
Gross profit rose 50.3% to $109.3 million. Gross margin slipped 0.8 percentage points to 71.2%. The company remained deeply unprofitable on a GAAP basis. Operating loss widened to $65.8 million, and operating margin fell 11.9 percentage points to negative 42.8%. Net loss widened to $64.3 million. Diluted EPS was negative $0.13, flat with the prior-year quarter. The gap between GAAP and non-GAAP results remains wide because of stock-based compensation and related charges. Non-GAAP operating loss was $20.2 million, and non-GAAP operating margin was negative 13%. Non-GAAP net loss per share was negative $0.04. Research and development, sales and marketing, and general and administrative expenses all rose faster than revenue, which drove the operating loss wider. The gross margin decline was mainly due to higher stock-based compensation expense after the company's IPO. The company's non-GAAP measures exclude stock-based compensation expense-related charges, employer taxes on employee equity transactions, and lease modification, impairment, and related charges.
Cash generation remains negative. Net cash used in operating activities was $37.0 million, up 17.5% from the prior-year quarter. Adjusted free cash flow was negative $38.4 million, and adjusted free cash flow margin was negative 25%. Capital expenditures were $6.3 million, up 126.8%. Deferred revenue was $354.6 million, up 29.2%. The company continues to invest in its cloud platform, IoT devices, and sales capacity. Management expects to keep incurring operating losses and negative cash flows for the foreseeable future, and it may need additional capital to fund its strategic initiatives. Management believes existing cash and cash equivalents will be sufficient to support working capital and capital expenditure requirements for at least the next 12 months. The adjusted free cash flow definition starts with net cash used in operating activities, subtracts purchases of property and equipment, and adds back non-recurring capital expenditures for the San Francisco office build-out.
Guidance points to slower growth ahead. For the third quarter of fiscal 2023, management guided revenue to $154 million to $156 million, with year-over-year growth of 35% to 37%. For the full fiscal year, it guided revenue to $610 million to $614 million, with year-over-year growth of 42% to 43%. The outlook also includes a non-GAAP operating margin of negative 20% for the third quarter and negative 18% for the full year, and non-GAAP net loss per share of negative $0.06 to negative $0.07 for the third quarter and negative $0.21 to negative $0.23 for the full year. Management did not provide GAAP guidance because it cannot reasonably predict certain items, such as stock-based compensation expense-related charges. The guidance includes non-GAAP financial measures, and a reconciliation to GAAP is not available on a forward-looking basis without unreasonable effort.
The macro backdrop remains difficult. Management called out rising inflation, disrupted supply chains, tight labor markets, and geopolitical risks. The Russia-Ukraine conflict, geopolitical tensions involving China, and the COVID-19 pandemic could affect customers, partners, and suppliers. Other risks include silicon component shortages, supply chain constraints, a security breach, intense competition, and rapid technological changes. Samsara's ability to retain customers, expand existing accounts, attract new customers, and innovate will determine whether it can sustain its growth rate while narrowing losses. The company also faces risks related to its ability to achieve or maintain profitability, demand for its products, and the impact of macroeconomic conditions on customer spending. Samsara operates in North America and Europe and serves a wide range of industries.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2023 | Q1 FY2023 | QoQ | Q2 FY2022 | YoY |
|---|---|---|---|---|---|
| Revenue | $153.5M | $142.6M | +7.6% | — | — |
| Gross profit | $109.3M | $103.0M | +6.1% | — | — |
| Gross margin | 71.2% | 72.2% | -1.1 pp | — | — |
| Research & development | $41.8M | $41.0M | +2.1% | — | — |
| Sales & marketing | $91.8M | $87.4M | +5.0% | — | — |
| General & administrative | $41.4M | $43.7M | -5.4% | — | — |
| Total operating expenses | $175.0M | $173.2M | +1.0% | — | — |
| Operating income (loss) | -$65.8M | -$70.2M | +6.3% | — | — |
| Operating margin | -42.9% | -49.2% | +6.4 pp | — | — |
| Net income (loss) | -$64.3M | -$71.0M | +9.4% | — | — |
| Net margin | -41.9% | -49.8% | +7.9 pp | — | — |
| Diluted EPS | -$0.13 | -$0.14 | +$0.01 | — | — |
Risks
MD&A states rising inflation and interest rates and a stronger U.S. dollar, especially versus the British Pound and Euro, may cause customers to defer or decrease expenditures. Revenue rose 51.9% in FY2023 Q2, but net loss widened to $64.3 million from $31.4 million in FY2022 Q2.
Risk factors state COVID-19 has increased the average length of sales cycles to onboard new customers, in some cases by more than several weeks or months, and large-customer sales cycles can exceed one year, pressuring revenue timing.
Risk factors cite an ongoing global silicon component shortage, strained freight networks, and a large manufacturing presence in Taiwan. Any delay in IoT device shipment delays revenue recognition for subscriptions purchased by customers.
Risk factors name Verizon Connect, Geotab, Omnitracs, Lytx, SmartDrive, Orbcomm, ZTR, Avigilon, Netradyne, Platform Science, and Verkada; some bundle products at significant discounts. The company also relies on Amazon AWS with no alternative provider.
Risk factors state employees historically had broad access to customers' video footage and some Applications can control large industrial assets. Abuse or misuse of internal platform controls could cause legal liability and reputational damage.
Risk factors state net losses of $135.3 million for the six months ended July 30, 2022 and an accumulated deficit of $1,056.2 million. The company may require additional capital and cannot guarantee it will be available on acceptable terms.
Risk factors state Q2 FY2023 stock-based compensation expense of $40.0 million related to RSUs and $328.0 million of unrecognized stock-based compensation as of July 30, 2022, which will adversely impact the ability to achieve profitability.
Risk factors state contracts are typically three to five years but customers have no obligation to renew. Some customers have elected not to renew, and limited experience with renewal cycles makes long-term retention difficult to predict.
Risk factors cite the Russia-Ukraine conflict, China-Taiwan tensions, and related cyber threats, including the U.S. government's 'Shields Up' alert. These could disrupt manufacturing, increase costs, and heighten security risk.
Risk factors flag that issues in the use of artificial intelligence in the solution may result in reputational harm or liability, and competitors such as Avigilon specialize in video analytics and AI.
Risk factors cite the 'great resignation' and competition for engineers, technical staff, and sales personnel. Sales team turnover causes costly training and operational inefficiency, and failure to retain key personnel could harm growth.
Risk factors state recent growth should not be considered indicative and the revenue growth rate will decline in the future due to maturation, competition, and slowing demand. Revenue rose 51.9% in FY2023 Q2.
Risk factors state the company expects to cease being an emerging growth company as of January 28, 2023, triggering auditor attestation of internal control over financial reporting and additional public-company compliance costs.
SaaS KPIs
All quarters →Non-GAAP Operating Margin
Adjusted Free Cash Flow Margin
Non-GAAP Gross Margin
Annual Recurring Revenue (ARR)
Summary, forecast, risks and KPIs are extracted from Samsara Inc.'s SEC filings for Q2 FY2023 (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.