As a rule of thumb, exceeding financial estimates usually generates investor excitement. Unfortunately, that wasn’t the case for software developer GitLab, Inc. (NASDAQ:GTLB). For the first quarter of fiscal 2026, GitLab posted earnings per share of 17 cents, beating the consensus view of 15 cents. Further, revenue landed at $214.51 million, beating estimates calling for $213.16 million. Still, GTLB stock slipped hard after the results, which were disclosed in June.
Unfortunately, investors took a dim view of the updated guidance for the second quarter. Although GitLab sees adjusted second-quarter EPS landing between 16 cents and 17 cents (compared to the 16-cent estimate), management revealed that revenue may land between $226 million and $227 million. This range conspicuously dipped below Wall Street’s expectation of $227.16 million.
Still, the leadership team emphasized the value of its core business. GitLab specializes in a field known as DevSecOps, a combination of development, security and operations. Specifically, the company simplifies software delivery by combining hosting, CI/CD (continuous integration and continuous deployment), security and project management into one seamless platform. Further, GitLab integrates artificial intelligence into this platform, enhancing productivity and security.
“First quarter fiscal year 2026 results underscore the power of our AI-native DevSecOps platform to help customers deliver mission-critical software. We’re giving every developer the AI-driven edge they need to innovate faster and more efficiently,” said Bill Staples, GitLab CEO.
It’s also worth pointing out that, despite last month’s volatility in GTLB stock, Wall Street analysts still anticipate robust capital gains. True, several experts — while maintaining their assessments of the company — lowered their price forecasts. Still, even some of the more modest targets imply about a 15% lift from current prices.
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