Summary
SentinelOne closed fiscal 2026 with $271.2 million of fourth-quarter revenue, up 20.2% from $225.5 million in the prior-year quarter. Full-year revenue reached $1,001.3 million against $821.5 million a year earlier, an increase of 21.9%, pushing the company past the billion-dollar mark for the first time. Annualized recurring revenue stood at $1,119.1 million as of January 31, 2026, up 22% year over year, and customers with ARR of $100,000 or more grew 18% to 1,667. Deferred revenue of $633.1 million was up 10.7% from $572.1 million, while remaining performance obligations of $1.4 billion rose 19.8% from $1.17 billion. Management pointed to 96% gross retention and 109% net retention among $100,000-plus ARR customers, more than 50% of annual bookings from emerging products such as Data, AI and Cloud, and a record attach rate above 50% for Purple AI on licenses sold in the quarter.
Margins were mixed. GAAP gross margin for the quarter fell to 72.6% from 74.7%, a decline of 2.1 percentage points, although the full-year figure of 74.1% was only marginally below the prior year's 74.3%. Non-GAAP gross margin was 78% for the quarter compared with 79%, and 79% for the full year in both periods. The GAAP operating loss was essentially flat at $79.9 million versus $80.3 million, and the quarterly operating margin improved to negative 29.5% from negative 35.6%. For the full year, the operating loss narrowed to $321.3 million from $329.4 million. Non-GAAP operating margin was 6% in the quarter compared with 1%, and 3% for the full year versus negative 3%.
Net loss is where the story turns. The quarterly GAAP net loss widened to $110.2 million from $70.8 million, and the full-year net loss widened to $450.7 million from $288.4 million. Diluted loss per share for fiscal 2026 was $1.37 versus $0.92. A large part of the swing traces to the January 2026 Assessment Agreement with the Israel Tax Authorities, which resolves transfer pricing matters for fiscal years 2021 through 2025 and requires installment payments through fiscal 2031 at 7.0% interest. A change of control would accelerate the unpaid balance, which was $255.1 million as of January 31, 2026. Non-GAAP net income margin was 9% in the quarter versus 5% a year earlier, so the gap between reported and adjusted profitability remains wide.
Cash performance improved. Operating cash flow was $4.4 million in the quarter, against a use of $3.4 million a year earlier, and $76.6 million for the full year versus $33.7 million. Capital expenditures were $0.71 million for the year, down 61.7% from $1.86 million. Free cash flow, a non-GAAP measure defined as operating cash flow less purchases of property and equipment and capitalized internal-use software, was negative $2.3 million in the quarter and $51.9 million for the year. SentinelOne also repurchased 12.2 million Class A shares for $200.0 million, at an average price of $16.39, fully using its 2025 repurchase authorization.
Guidance for the first quarter of fiscal 2027 targets non-GAAP operating income of $4 million to $6 million and non-GAAP diluted EPS of $0.01 to $0.02. For the full fiscal year 2027, management guided to non-GAAP operating income of $110 million to $120 million and non-GAAP diluted EPS of $0.32 to $0.38, on a 17% non-GAAP tax rate and 352 million diluted shares. The risk list stays familiar: intense competition, longer sales cycles, deal downsizing among large enterprises, and macroeconomic and geopolitical uncertainty, including changes in U.S. federal spending and government shutdowns. Purchase obligations were $732.0 million, with $182.9 million due within 12 months, and the tax installments will weigh on cash flow for several years.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q4 FY2026 | Q3 FY2026 | QoQ | Q4 FY2025 | YoY |
|---|---|---|---|---|---|
| Revenue | $271.2M | $258.9M | +4.7% | $225.5M | +20.2% |
| Gross profit | $196.8M | $191.1M | +3.0% | $168.5M | +16.8% |
| Gross margin | 72.6% | 73.8% | -1.2 pp | 74.7% | -2.1 pp |
| Research & development | $89.4M | $83.1M | +7.5% | $74.6M | +19.7% |
| Sales & marketing | $136.8M | $126.6M | +8.1% | $128.1M | +6.8% |
| General & administrative | $50.5M | $51.5M | -1.9% | $46.1M | +9.6% |
| Total operating expenses | $276.7M | $264.4M | +4.7% | $248.8M | +11.2% |
| Operating income (loss) | -$79.9M | -$73.3M | -9.0% | -$80.3M | +0.4% |
| Operating margin | -29.5% | -28.3% | -1.2 pp | -35.6% | +6.1 pp |
| Net income (loss) | -$110.2M | -$60.3M | -82.8% | -$70.8M | -55.7% |
| Net margin | -40.6% | -23.3% | -17.4 pp | -31.4% | -9.3 pp |
| Diluted EPS | -$0.33 | -$0.18 | -$0.15 | -$0.22 | -$0.11 |
Risks
On January 8, 2026, SentinelOne entered an Assessment Agreement with the Israel Tax Authority resolving transfer pricing matters for fiscal 2021 through 2025. The company recorded $180.9 million of tax expense, inclusive of interest, in fiscal 2026, must make installment payments through 2030 with 7.0% annual interest, and a change in control could accelerate $255.1 million as of January 31, 2026 less cumulative payments.
SentinelOne is making significant investments in generative and agentic AI, including Purple AI, Wayfinder, and the September 2025 acquisitions of Prompt and Observo. It relies on third-party foundation models and faces evolving AI regulation such as the EU AI Act and a December 2025 U.S. executive order, while competitors may incorporate AI more successfully.
MD&A states that the company has experienced a decline in usage and consumption patterns from certain customers, especially larger enterprise customers, longer sales cycles, and deal downsizing by new customers and of renewals by existing customers. Management expects global macroeconomic conditions impacting demand to persist in the near term.
The cybersecurity market is intensely competitive and fragmented, and many competitors have greater financial, technical, marketing, sales, and other resources. SentinelOne says competitive pressures could cause price reductions, fewer orders, reduced revenue and gross margin, increased net losses, and loss of market share.
Customers have no obligation to renew subscriptions after contractual terms generally of one to three years, and some have elected not to renew or have reduced the scope or duration of their subscriptions. If SentinelOne cannot retain, renew, and expand customer relationships, revenue growth and profitability could materially suffer.
Substantially all sales are fulfilled through channel partners, agreements are generally non-exclusive and may be terminated at any time, and several large MSSP, OEM, and reseller partnerships include multi-year purchasing commitments. Partner failure to meet commitments, partner consolidation, or partner credit issues would harm sales and operating results.
SentinelOne has acquired and expects to continue acquiring companies, including PingSafe, Stride, Prompt, and Observo, and has invested through S Ventures. Integration may divert management, fail to achieve expected benefits, cause unanticipated write-offs, or expose the company to unknown liabilities.
Cash, cash equivalents, and investments were $769.6 million as of January 31, 2026, down from $1.1 billion as of January 31, 2025. The 2025 Share Repurchase Program was fully utilized at $200.0 million, and ITA installment payments will adversely affect cash flows over the next several years.
Sales to government organizations depend on unpredictable budgets and funding authorizations; the risk factors cite the U.S. Department of Government Efficiency and potential changes in federal, state, and local budget priorities that could reduce purchases. SentinelOne must also maintain FedRAMP authorization to sell to government customers.
SentinelOne is subject to privacy and data protection laws and an evolving AI regulatory landscape, including the EU AI Act with phased implementation that began in 2025. Compliance requires significant investment, and failure could result in fines, enforcement actions, or restrictions on AI-powered products.
SaaS KPIs
All quarters →Customers with ARR of $100,000 or more
Summary, forecast, risks and KPIs are extracted from SentinelOne, Inc.'s SEC filings for Q4 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 6, 2026.