GitLab 2026 Q3 Earnings Net Loss Widens 131.6% Despite Revenue Surge

GitLab (GTLB) reported fiscal 2026 Q3 results on Dec 2nd, 2025, with revenue beating estimates by $5.03 million and non-GAAP EPS exceeding forecasts by $0.05. However, the company swung to a net loss of $8.80 million, marking a 131.6% deterioration year-over-year. Guidance for Q4 2026 remained in line with expectations, projecting $251–252 million in revenue (19% YoY growth).

Revenue

GitLab’s total revenue surged 24.6% year-over-year to $244.35 million, driven by robust performance in its core subscription and SaaS offerings. Subscription-self-managed and SaaS revenue accounted for the lion’s share at $223.26 million, while License-self-managed and other segments contributed $21.09 million. The company’s focus on DevSecOps expansion and AI integration fueled this growth, underscoring strong demand for its unified platform.

Earnings/Net Income

The company posted a net loss of $8.80 million in Q3 2026, compared to a $27.80 million net income in the prior-year period. Earnings per share turned negative at -$0.05, a stark contrast to the $0.18 profit in 2025 Q3. The decline reflects ongoing operational challenges and strategic investments, though non-GAAP operating income reached $43.7 million, highlighting improved efficiency.

Price Action

GitLab’s stock gained 1.88% on the day of the earnings release and 4.63% for the week, but fell 8.66% month-to-date. The post-earnings rally saw a 5.39% surge to $42.65, driven by confidence in its growth trajectory.

Post-Earnings Price Action Review

The strategy of purchasing GitLab shares following its Q3 earnings beat and holding for 30 days generated a 9.77% cumulative return over three years, with $4.77 per share in absolute gains. This momentum stemmed from consistent revenue growth (24.7% YoY in Q3 2025) and positive market sentiment. However, short-term volatility, including a 15.77% decline in the past 30 days, posed risks to the strategy. Long-term, the company’s ability to exceed estimates and innovate in AI-driven workflows supported its value proposition.

CEO Commentary

CEO Bill Staples emphasized Q3’s 25% revenue growth and 18% non-GAAP operating margin, exceeding guidance. Strategic priorities include accelerating the Duo Agent platform for AI-powered workflows and expanding go-to-market teams to target mid-market and enterprise customers. Staples highlighted GitLab’s unique position to validate AI-generated code through its unified platform, ensuring compliance and governance.

Guidance

GitLab guided Q4 2026 revenue to $251–252 million (19% YoY growth) and non-GAAP operating income of $38–39 million. Full-year revenue is expected to reach $946–947 million (25% growth). CFO James Shen noted ongoing challenges in SMB and U.S. public sectors, including lingering effects from a government shutdown. The company plans to adopt a hybrid seat-plus-usage-based pricing model with Duo Agent, though self-managed customers may slow adoption. Free cash flow remains strong, with $1.2 billion in cash and investments.

Additional News

GitLab announced the appointment of Jessica Ross as CFO, effective January 15, 2026, succeeding interim CFO James Shen. Ross brings extensive public company finance experience and will oversee global finance and investor relations as the company accelerates AI-driven innovation. Additionally, the company outlined a strategic shift to a hybrid usage-based pricing model for its Duo Agent platform, aiming to align with evolving market demands. Management also highlighted ongoing monitoring of its China joint venture, which incurred $3.3 million in non-GAAP expenses in Q3.