Summary
Sprinklr opened fiscal 2025 with total revenue of $195.96 million, up 13.0% from $173.36 million in the prior-year quarter. Gross profit rose 10.2% to $144.83 million, but gross margin slipped to 73.9% from 75.8%. The pressure came from delivery costs rather than pricing. Higher third-party cloud infrastructure and data costs pushed subscription costs up, and the company added Contact Center as a Service delivery personnel ahead of expected demand, which weighed on professional services margins. Management expects gross margin to keep varying with revenue mix and the timing of services delivery.
Profitability swung hard in the other direction. GAAP operating income was $5.71 million, compared with an operating loss of $3.19 million a year earlier, and operating margin moved to 2.9% from negative 1.8%. Net income rose 278.7% to $10.63 million from $2.81 million. Diluted EPS was $0.04, up from $0.01. On a non-GAAP basis, operating income was $20.4 million against $11.0 million, non-GAAP operating margin was 10% versus 6%, and non-GAAP diluted EPS was $0.09 compared with $0.06. Sales and marketing spending declined year over year, while research and development and general and administrative costs rose.
Cash generation was the cleanest part of the quarter. Operating cash flow was $41.71 million, up 124.7% from $18.56 million. Free cash flow, which deducts purchases of property and equipment and capitalized internal-use software, was $36.2 million. Capital expenditures were $2.54 million, up 56.6%. Operating cash flow benefited from a large decrease in accounts receivable, partly offset by lower accrued expenses, accounts payable and deferred revenue. Cash, cash equivalents and marketable securities totaled $610.1 million as of April 30, 2024. The company spent $101.2 million repurchasing roughly 8.3 million Class A shares during the quarter and had bought 14,301,236 shares under the 2024 program through May 31, 2024. The board authorized another $100 million in June 2024.
Backlog and customer counts held up better than the expansion rate. RPO was $922.50 million, up 30.3%, and cRPO was $570.4 million, up 19%. Deferred revenue, current portion, was $370.23 million, up 15.0%. Large customers, defined as those with at least $1.0 million in trailing twelve-month subscription revenue, numbered 138 versus 115 a year earlier. Net dollar expansion rate fell to 114.6% from 122.2%, a decline management attributed to elevated churn worsened by the macroeconomic environment.
Guidance for the second quarter ending July 31, 2024 calls for subscription revenue of $177.5 million to $178.5 million, non-GAAP operating income of $16.5 million to $17.5 million, and non-GAAP diluted EPS of $0.06 to $0.07 on 277 million diluted weighted-average shares. For the full fiscal year ending January 31, 2025, the outlook is subscription revenue of $714 million to $716 million, non-GAAP operating income of $104 million to $105 million, and non-GAAP EPS of $0.40 to $0.41 on 276 million diluted shares. Management described a more challenging macro environment and said the changes and initiatives under way will take several quarters to work through. Sprinklr also named Trac Pham as Co-CEO alongside founder Ragy Thomas. The main risks are the softening expansion rate, margin pressure from cloud and data costs, a long and unpredictable enterprise sales cycle, and revenue concentration among a relatively small number of large customers.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q1 FY2025 | Q4 FY2024 | QoQ | Q1 FY2024 | YoY |
|---|---|---|---|---|---|
| Revenue | $196.0M | $194.2M | +0.9% | $173.4M | +13.0% |
| Gross profit | $144.8M | $146.7M | -1.2% | $131.4M | +10.2% |
| Gross margin | 73.9% | 75.5% | -1.6 pp | 75.8% | -1.9 pp |
| Research & development | $22.5M | $23.1M | -2.3% | $20.8M | +8.6% |
| Sales & marketing | $87.5M | $77.1M | +13.5% | $89.2M | -1.9% |
| General & administrative | $29.1M | $28.1M | +3.7% | $24.7M | +18.0% |
| Total operating expenses | $139.1M | $128.2M | +8.5% | $134.6M | +3.3% |
| Operating income (loss) | $5.7M | $18.5M | -69.1% | -$3.2M | +278.8% |
| Operating margin | 2.9% | 9.5% | -6.6 pp | -1.8% | +4.8 pp |
| Net income (loss) | $10.6M | $21.1M | -49.7% | $2.8M | +278.7% |
| Net margin | 5.4% | 10.9% | -5.5 pp | 1.6% | +3.8 pp |
| Diluted EPS | $0.04 | $0.07 | -$0.03 | $0.01 | +$0.03 |
Risks
MD&A highlights rising inflation, higher interest rates, bank closures, and the Russia-Ukraine and Israel-Hamas wars as creating economic uncertainty that may slow customer spending on information technology. NDE fell to 114.6% for the trailing 12 months ending April 30, 2024 from 122.2% a year earlier, partly due to elevated churn from the macro environment.
The filing emphasizes dependence on customer renewals and expansion; MD&A reports NDE decreased to 114.6% for the trailing 12 months ended April 30, 2024 from 122.2% for the prior-year period, driven by elevated churn exacerbated by macroeconomic conditions. A further decline in renewals or expansion would harm revenue.
The filing materially expands AI and Generative AI risk, noting use through third-party partners such as OpenAI, potential flawed or biased outputs, leakage of sensitive data, reputational harm, and emerging regulation including the EU AI Act and Biden executive order. If deployment fails or competitors adopt AI more successfully, Sprinklr's competitive position could be impaired.
Growth depends on third-party data and APIs; the agreement with X (formerly Twitter) that supports the Unified-CXM platform expires February 28, 2025. If it is not renewed on similar terms or at all, the company may not provide the same level of Unified-CXM insights, materially harming results.
Gross margin in the current quarter was 73.9%, down 1.9 pp from 75.8% in the prior-year quarter. MD&A attributes the decline to higher third-party cloud infrastructure and data costs and an 8 percentage point drop in professional services gross margin from increased CCaaS service delivery investment.
MD&A notes historical seasonality with a large percentage of customers purchasing in the fourth quarter and paying in the first quarter, creating higher billings in Q4 and higher collections in H1. Results of operations may fluctuate due to variability in sales cycle, customer budgeting cycles, payment terms, and subscription term length.
The Unified-CXM market is new and rapidly evolving, and competitors may bundle or integrate competing products at lower prices. If the market develops more slowly than expected or if Sprinklr does not compete effectively, demand and pricing could be adversely affected.
During the current quarter the company repurchased approximately 8.3 million Class A shares for $101.2 million, leaving $69.4 million available under the 2024 program as of April 30, 2024; it bought an additional 3.29 million shares for $40.1 million in May 2024 and the Board approved another $100 million. The program may not be fully consummated and could diminish cash reserves.
For the three months ended April 30, 2024, approximately 41% of sales were to customers outside the Americas. International expansion subjects the company to compliance, data localization, currency, and longer sales cycle risks that could increase costs or reduce revenue.
SaaS KPIs
All quarters →Free Cash Flow
Non-GAAP Operating Margin
RPO
cRPO
Non-GAAP Operating Income
Summary, forecast, risks and KPIs are extracted from Sprinklr, Inc.'s SEC filings for Q1 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 1, 2026.