--- title: "Netskope | 10-K: FY2026 Revenue Beats Estimate at USD 709 M" type: "News" locale: "en" url: "https://longbridge.com/en/news/281251926.md" datetime: "2026-03-31T21:37:02.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/281251926.md) - [en](https://longbridge.com/en/news/281251926.md) - [zh-HK](https://longbridge.com/zh-HK/news/281251926.md) --- # Netskope | 10-K: FY2026 Revenue Beats Estimate at USD 709 M Revenue: As of FY2026, the actual value is USD 709 M, beating the estimate of USD 701.27 M. EPS: As of FY2026, the actual value is USD -3.18, beating the estimate of USD -3.5277. ### Segment Revenue - Subscription revenue constituted approximately 99% of Netskope, Inc.’s total revenue in fiscal 2026 and fiscal 2025. Professional services and hardware accounted for an immaterial portion of total revenue . ### Operational Metrics #### Revenue - Netskope, Inc.’s revenue increased by $170,729 thousand, or 32%, to $708,997 thousand in fiscal 2026 from $538,268 thousand in fiscal 2025 . Approximately 29% of this increase was due to new customer additions, while approximately 71% was driven by expansion within existing customers . #### Cost of Revenue - Cost of revenue increased by $35,959 thousand, or 19%, to $226,328 thousand in fiscal 2026 compared to $190,369 thousand in fiscal 2025 . This increase was primarily due to a $36.3 million increase in employee-related compensation expense, including $29.7 million in stock-based compensation and related payroll taxes recognized upon the IPO . Colocation and network transit expenses also increased by $8.7 million, partially offset by a $5.8 million decrease in amortization of intangible assets and a $3.3 million decrease in cloud infrastructure and software expenses . #### Gross Profit and Gross Margin - Gross profit increased by $134,770 thousand, or 39%, to $482,669 thousand in fiscal 2026 from $347,899 thousand in fiscal 2025 . Gross margin improved to 68% in fiscal 2026 from 65% in fiscal 2025, primarily due to revenue growth outpacing the growth in cost of revenue, reflecting improved operating efficiencies . #### Sales and Marketing Expenses - Sales and marketing expenses increased by $112,914 thousand, or 40%, to $393,742 thousand in fiscal 2026 compared to $280,828 thousand in fiscal 2025 . This was mainly driven by a $94.5 million increase in employee-related compensation expense, including $70.3 million of stock-based compensation, and increases in amortization of capitalized sales commissions ($7.8 million) and marketing-related expenses ($5.3 million) . #### Research and Development Expenses - Research and development expenses increased by $254,840 thousand, or 100%, to $509,029 thousand in fiscal 2026 compared to $254,189 thousand in fiscal 2025 . The increase was largely due to a $241.9 million increase in employee-related compensation expense, including $206.0 million of stock-based compensation, and an $8.4 million increase in outside services . #### General and Administrative Expenses - General and administrative expenses increased by $163,854 thousand, or 239%, to $232,477 thousand in fiscal 2026 compared to $68,623 thousand in fiscal 2025 . This was primarily attributable to a $159.9 million increase in employee-related compensation expense, including $154.4 million of stock-based compensation, and a $5.8 million increase in professional services . #### Loss from Operations - Loss from operations increased to -$652,579 thousand in fiscal 2026 from -$255,741 thousand in fiscal 2025 . #### Net Loss - Netskope, Inc. reported a net loss of -$679,388 thousand in fiscal 2026, compared to a net loss of -$354,510 thousand in fiscal 2025 . #### Loss on Changes in Fair Value of Convertible Notes - Loss on changes in fair value of Convertible Notes decreased by $64,371 thousand, or -65%, to -$34,256 thousand in fiscal 2026 compared to -$98,627 thousand in fiscal 2025 . #### Other Income, net - Other income, net increased by $14,681 thousand, or 358%, to $18,782 thousand in fiscal 2026 compared to $4,101 thousand in fiscal 2025 . This was mainly due to a $9.1 million increase in interest income, a $3.7 million increase in foreign currency exchange gain, and a $2.2 million increase in the accretion of discounts on investments in debt securities . #### Provision for Income Taxes - Provision for income taxes increased by $7,092 thousand, or 167%, to $11,335 thousand in fiscal 2026 compared to $4,243 thousand in fiscal 2025, primarily due to higher foreign tax liabilities from international expansion . ### Cash Flow #### Net Cash Provided by (Used in) Operating Activities - Net cash provided by operating activities was $38,073 thousand in fiscal 2026, a significant improvement from net cash used in operating activities of -$110,678 thousand in fiscal 2025 . This improvement was driven by a decrease in accounts receivable and increases in accrued compensation and benefits, accounts payable, and accrued expenses and other current liabilities, partially offset by higher deferred contract acquisition costs and prepaid expenses . #### Free Cash Flow - Free cash flow was $12,373 thousand in fiscal 2026, compared to -$151,100 thousand in fiscal 2025 . ### Unique Metrics #### Dollar-Based Net Retention Rate (NRR) - The NRR was 116% as of January 31, 2026, up from 113% as of January 31, 2025 . #### Concentration of Revenue and Accounts Receivable - As of January 31, 2026, one channel partner accounted for approximately 14% of the accounts receivable, net balance . For fiscal 2026, Channel Partner A represented 14% of total revenue . #### Convertible Notes - As of January 31, 2026, the aggregate principal and accrued interest of the 2028 Notes was $450,383 thousand, convertible into 18,963,200 shares of Class B common stock . The 2029 Notes had an aggregate principal and accrued interest of $78,368 thousand, convertible into 3,172,805 shares of Class B common stock . The maximum amount potentially owed under the 2028 Notes at maturity (December 2028) is $913.2 million, and for the 2029 Notes (August 2029) is $145.1 million . ### Outlook / Guidance Netskope, Inc. anticipates continued increases in operating expenses in the near-term due to investments in sales, marketing, new markets, and platform development, along with costs associated with being a public company . The company expects non-GAAP gross margin, non-GAAP operating margin, and free cash flow to improve over the long term, though free cash flow improvement is not expected to be linear . Existing cash, cash equivalents, and marketable securities are believed to be sufficient for working capital and capital expenditures for at least the next 12 months . ### Related Stocks - [NTSK.US](https://longbridge.com/en/quote/NTSK.US.md) ## Related News & Research - [Netskope Unveils AgentSkope As Investors Weigh AI Automation Prospects](https://longbridge.com/en/news/285815088.md) - [ONWARD Medical to Announce First Quarter 2026 Results on May 26, 2026 | ONWRY Stock News](https://longbridge.com/en/news/286858298.md) - [Electro-Sensors GAAP EPS of -$0.03, revenue of $2.6M](https://longbridge.com/en/news/286518577.md) - [Sangoma Announces Third Quarter Fiscal 2026 Results | SANG Stock News](https://longbridge.com/en/news/286317217.md) - [Vulnerability Exploitation Top Breach Entry Point, 2026 Industry-Wide DBIR Finds | VZ Stock News](https://longbridge.com/en/news/286918426.md)