Summary
Sprinklr posted total revenue of $178.5 million for the second quarter of fiscal 2024, up 18.5% from $150.6 million in the same quarter last year. Revenue for the six months ended July 31, 2023 was $351.8 million, up 19.0% from $295.6 million. Subscription sales to existing and new customers drove the increase, while professional services revenue declined on lower implementation and managed services work.
Gross profit for the quarter was $135.0 million, up 24.5% from $108.5 million a year earlier. Gross margin of 75.6% was up 3.6 percentage points from 72.0%. The company swung to an operating profit of $5.5 million from an operating loss of $21.7 million in the prior-year quarter, and GAAP operating margin was 3.1%, up 17.5 percentage points. Net income was $10.5 million against a net loss of $23.9 million, and diluted earnings per share were $0.04 versus a diluted loss per share of $0.09. For the six months, net income was $13.3 million compared with a net loss of $49.2 million, and operating income was $2.3 million compared with an operating loss of $44.8 million.
On a non-GAAP basis, operating income was $21.3 million against a non-GAAP operating loss of $4.9 million a year ago, and non-GAAP operating margin was 12%. Non-GAAP net income per basic share was $0.10 compared with a non-GAAP net loss per basic share of $0.03. Higher interest income on money market and short-term investment accounts helped push net income above operating income for the quarter, and the filing attributes most of the change in other income, net to that interest income.
Cash generation improved sharply. Operating cash flow was $14.6 million for the quarter, up 147.7% from $5.9 million, and $33.1 million for the six months, up 1,014.2% from $3.0 million. Free cash flow, a non-GAAP measure defined as net cash provided by operating activities less purchases of property and equipment and capitalized internal-use software, was $8.7 million in the quarter against $1.4 million a year earlier. Capital expenditures were $2.8 million in the quarter, up 62.7% from $1.7 million. Deferred revenue was $322.9 million, up 16.9% year over year, and remaining performance obligations were $806.4 million, up 32.8%. Current RPO was $510.4 million, up 22% from $419.2 million. Large customers, those with at least $1.0 million in trailing-12-month subscription revenue, numbered 120, up 22% from 98. Net dollar expansion rate slipped to 120.0% from 124.6%.
Guidance points to more of the same on profitability. For the third quarter of fiscal 2024, management guides to non-GAAP operating income of $15 million to $17 million and non-GAAP net income per share of $0.06 to $0.07, assuming 274 million basic weighted-average shares outstanding. For the full fiscal year ending January 31, 2024, the outlook is non-GAAP operating income of $65 million to $67 million and non-GAAP net income per share of $0.30 to $0.31, assuming 273 million basic weighted-average shares. The company states that it cannot reconcile the forward-looking non-GAAP figures to their closest GAAP measures without unreasonable effort because stock-based compensation swings with its share price. Note that the guidance is non-GAAP, so the GAAP results reported this quarter are not directly comparable to the targets.
Cost discipline did much of the work this quarter. Sales and marketing expense fell as restructuring actions taken in both fiscal years reduced personnel costs, research and development spending rose, and general and administrative costs grew on consulting and professional fees. The 10-Q risk list is long. Rapid growth may not be indicative of future growth, the revenue growth rate has fluctuated, and the company may not achieve or maintain profitability. It depends on subscriptions for the substantial majority of revenue, a small number of large enterprises generate a significant portion of revenue, sales cycles with enterprise and international clients can be long and unpredictable, and it relies on third-party data centers and cloud computing providers. Macroeconomic conditions, including inflation, higher interest rates, recent bank closures and geopolitical conflict, are flagged as well, and the filing notes that prior-year RPO and cRPO were corrected for the treatment of an immaterial number of contracts.
Forecast
Reported figures
GAAP, from SEC filings| Metric | Q2 FY2024 | Q1 FY2024 | QoQ | Q2 FY2023 | YoY |
|---|---|---|---|---|---|
| Revenue | $178.5M | $173.4M | +2.9% | $150.6M | +18.5% |
| Gross profit | $135.0M | $131.4M | +2.7% | $108.5M | +24.5% |
| Gross margin | 75.6% | 75.8% | -0.2 pp | 72.0% | +3.6 pp |
| Research & development | $24.3M | $20.8M | +17.2% | $20.0M | +21.7% |
| Sales & marketing | $80.1M | $89.2M | -10.2% | $86.9M | -7.8% |
| General & administrative | $25.1M | $24.7M | +1.7% | $23.2M | +8.0% |
| Total operating expenses | $129.5M | $134.6M | -3.8% | $130.1M | -0.5% |
| Operating income (loss) | $5.5M | -$3.2M | +271.9% | -$21.7M | +125.3% |
| Operating margin | 3.1% | -1.8% | +4.9 pp | -14.4% | +17.5 pp |
| Net income (loss) | $10.5M | $2.8M | +273.4% | -$23.9M | +143.8% |
| Net margin | 5.9% | 1.6% | +4.3 pp | -15.9% | +21.8 pp |
| Diluted EPS | $0.04 | $0.01 | +$0.03 | -$0.09 | +$0.13 |
Risks
Risk factors newly emphasize use of Generative AI and third-party large language models, noting use at scale is relatively new and may yield flawed, biased, or inaccurate results, leak sensitive data, and trigger reputational harm or regulatory fines. If deployment fails or competitors adopt Generative AI more successfully, Sprinklr may be at a competitive disadvantage.
The company identified a material weakness in its process to manage and record commission and bonus expense for the year ended January 31, 2023, and remediation is still being implemented. Failure to remediate could prevent accurate or timely financial reporting and adversely affect investor views and stock value.
Sprinklr relies on negotiated data agreements, including one with X, formerly Twitter, that expires on February 28, 2025. If that agreement is not renewed on similar terms or is terminated, the company may not provide the same level of Unified-CXM insights, materially harming business and results.
The company depends on customer renewals and expansion, but net dollar expansion rate was 120.0% for the trailing 12 months ended July 31, 2023, compared with 124.6% for the prior-year period. Customers may not renew, may renew on less favorable terms, or may reduce subscription scope, harming revenue.
MD&A and risk factors cite economic uncertainty from rising inflation, Federal Reserve interest rate increases, recent bank closures, and the Russia-Ukraine war. Customers may slow information technology spending, reduce Unified-CXM budgets, or request extended billing terms, which could limit growth.
The Unified-CXM market is new, rapidly evolving, and highly competitive, with competitors potentially bundling similar products or customers building internal solutions. Acquisitions or consolidation among data providers could also limit Sprinklr's access to customer feedback data.
Sprinklr is pursuing U.S. federal, state, local, and foreign government agency customers, which can be highly competitive and time-consuming, require certifications, and depend on public sector budgets. Work with sensitive-industry government customers could also create public criticism and reputational risk.
MD&A says professional services gross margin decreased 9 percentage points in the quarter and 3 percentage points year to date, driven by investments in Sprinklr Service and the broader CCaaS offering. Continued scaling of that business may pressure overall margins.
SaaS KPIs
All quarters →Free Cash Flow
Non-GAAP Operating Margin
RPO
cRPO
Non-GAAP Gross Margin
Summary, forecast, risks and KPIs are extracted from Sprinklr, Inc.'s SEC filings for Q2 FY2024 (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.