GitLab Q1 FY26 Earnings: Strong Growth Meets Strategic Spending

GitLab, a key player in the DevSecOps platform space, recently released its financial results for the first quarter of fiscal year 2026. Let's dive into their latest 10-Q filing to unpack the numbers and see what they tell us about the company's performance and strategy. The big picture? Strong top-line growth continues, but so does the company's investment in future expansion, resulting in a net loss for the quarter.

Revenue Continues its Climb

GitLab's revenue growth remains impressive. For the quarter ending April 30, 2025, the company pulled in $214.5 million in total revenue, a solid 27% increase from the same period last year. This growth is primarily fueled by its core business:

• Subscription: This segment, which includes both self-managed and Software-as-a-Service (SaaS) offerings, generated $194.5 million, making up over 90% of total revenue.
• License and Other: The smaller license segment for self-managed customers and other services contributed $20.0 million.

Geographically, the United States remains GitLab's powerhouse, accounting for $176.9 million, or about 82% of its revenue.

The Path to Profitability

While revenue is growing, GitLab is spending heavily to maintain its momentum. The company boasts a stellar gross margin of 88.3%, meaning the direct cost of delivering its software is very low. However, operating expenses tell a different story.

The company spent $224.1 million on operating expenses, which include:

• Sales and Marketing: $107.6 million (50% of revenue)
• Research and Development: $65.4 million (30% of revenue)
• General and Administrative: $51.1 million (24% of revenue)

This aggressive spending on sales and product innovation led to an operating loss of $34.6 million. After accounting for interest income and other expenses, GitLab reported a net loss of $36.3 million, or -$0.22 per share.

The following flow visualization breaks down how GitLab's revenue was allocated across its costs and expenses during the quarter.

It's important to note that this quarter's net loss is a significant improvement from the $55.5 million loss reported in the same quarter last year, signaling a clear trend toward profitability.

What's Next?

GitLab's Q1 results paint a picture of a company in full growth mode. It is successfully expanding its revenue base while maintaining excellent gross margins. The substantial investments in sales and R&D are strategic bets on capturing a larger share of the DevSecOps market. While the company is not yet profitable, its narrowing losses suggest a disciplined approach to scaling the business. For now, the focus remains squarely on growth, and investors will be watching to see when these investments begin to fully pay off on the bottom line.