Ncino 2026 Q1 Earnings Strong Performance with Net Income Swinging 362%

Ncino(NCNO) reported its fiscal 2026 Q1 earnings on May 28th, 2025. Ncino exceeded expectations with a notable net income improvement, swinging 362% to $6.02 million. The company maintained its guidance in line with previous projections, anticipating subscription revenues between $507 million and $511 million. This quarter saw Ncino leverage robust demand for subscription services, resulting in record-setting fiscal Q1 net income. The company remains confident in its strategic direction, aiming for growth in AI capabilities and cross-selling opportunities in the mortgage and credit union markets.

Revenue
Ncino's total revenue for fiscal 2026 Q1 increased by 12.5% to reach $144.14 million, compared to $128.09 million in the same quarter of fiscal 2025. The subscription segment was the primary driver, generating $125.59 million, while professional services and other contributed $18.55 million to the total revenue.

Earnings/Net Income
Ncino achieved a remarkable turnaround in fiscal 2026 Q1, posting an EPS of $0.05, up from a loss of $0.03 per share in the previous year. This represents a 266.7% positive change. The company also recorded net income of $6.02 million, a 362.0% positive swing from the net loss of $-2.30 million in fiscal 2025 Q1. The EPS shows a positive growth trend.

Price Action
The stock price of Ncino has edged down 0.74% during the latest trading day, has climbed 3.76% during the most recent full trading week, and has surged 16.23% month-to-date.

Post-Earnings Price Action Review
The strategy of buying NCNO shares when there is a revenue miss and holding them for 30 days has historically resulted in poor performance. Backtesting this approach revealed a significant loss of -74.64%, with an excess return of -153.03% and a compound annual growth rate (CAGR) of -24.65%. This strategy also exhibited a high maximum drawdown of -85.59% and a low Sharpe ratio of -0.42, indicating elevated risk and negative returns. Investors should consider these metrics when evaluating their investment strategies, particularly in volatile market conditions. The findings suggest that caution is warranted when pursuing this approach, as it poses considerable financial risks.

CEO Commentary
Sean Desmond, CEO of nCino, highlighted the strong performance in Q1 2026, citing total revenues of $144.1 million, driven by a robust demand for subscription services. He emphasized the company's commitment to solving inefficiencies in financial institutions caused by legacy systems, stating, "We believe we've built a competitive moat that is both wide and deep." He expressed optimism about future growth, especially in AI capabilities and cross-selling opportunities in the mortgage and credit union markets. Desmond noted, "Our financial institution customers remain well positioned," reinforcing confidence in nCino's strategic direction and execution.

Guidance
For Q2 fiscal 2026, nCino expects total revenues between $142 million to $144 million and subscription revenues from $124.5 million to $126.5 million. Non-GAAP operating income is projected at $23.5 million to $24.5 million, with non-GAAP net income per share of $0.13 to $0.14. For the full fiscal year, the company reiterates its guidance for subscription revenues of $507 million to $511 million, representing an 8.5% growth at the midpoint, and anticipates adding $48 million to $51 million to annual contract value (ACV).

Additional News
nCino recently announced a $100 million stock buyback program, reflecting confidence in its strategic positioning and financial health. The company also completed the acquisition of Sandbox Banking, enhancing its data connectivity solutions. Furthermore, nCino plans to lay off 7% of its employees, aiming to streamline operations and focus resources on key growth areas. These strategic moves underscore a commitment to optimizing business efficiency and strengthening its competitive stance in the market.