Sprinklr 2026 Q3 Earnings Revenue Growth Outpaces Expectations Despite Net Income Decline

Sprinklr (CXM) reported Q3 2026 results that exceeded revenue expectations while missing earnings targets, with full-year guidance raised amid strategic AI and customer engagement initiatives. The stock’s post-earnings performance highlighted mixed investor sentiment, as beaten revenue forecasts failed to translate into positive returns.

Sprinklr (CXM), a market capitalization leader in customer experience management (CXM), reported fiscal 2026 Q3 earnings on Dec 4, 2025. The company delivered stronger-than-expected revenue growth, beating consensus estimates, while net income contracted sharply.

Revenue

Sprinklr’s total revenue rose 9.2% year-over-year to $219.07 million in Q3 2026, driven by a 5% increase in subscription revenue to $190.29 million. Professional services revenue also contributed meaningfully, reaching $28.77 million, reflecting robust demand for implementation and support services. The subscription segment, which accounts for the majority of the company’s revenue, underscored its core strength in recurring revenue streams, while professional services growth highlighted ongoing customer adoption and expansion.

Earnings/Net Income

The company’s EPS fell sharply to $0.01 in Q3 2026, a 75% decline from $0.04 in the prior-year period. Net income also dropped 72.2% to $2.90 million, reflecting elevated operational costs and strategic investments in AI-driven platforms. The earnings shortfall, despite revenue outperformance, signals margin pressures stemming from increased R&D and go-to-market expenditures.

Post-Earnings Price Action Review

The strategy of buying CXM when it beats revenue and holding for 30 days resulted in a -45.31% return, significantly underperforming the benchmark return of 52.45%.

This underperformance, despite a positive revenue surprise, underscores the stock’s volatility, with a Sharpe ratio of -0.27 and a 51.28% volatility level. The strategy’s maximum drawdown of 0.00% suggests no significant losses during the backtest period, but inconsistent returns highlight the risks of relying on revenue-beat signals alone.

CEO Commentary

Rory Read, CEO, emphasized progress in operational transformation and AI integration, noting a 15% non-GAAP operating margin for the quarter. He acknowledged challenges in stabilizing renewal rates but expressed confidence in the company’s long-term growth trajectory.

Guidance

For Q4 2026, Sprinklr expects total revenue of $216.5–$217.5 million (7% YoY growth at midpoint) and non-GAAP operating income of $29–$30 million. Full-year FY26 guidance includes $853–$854 million in total revenue (7% YoY growth) and $137.5–$138.5 million in non-GAAP operating income. CFO Anthony Coletta reiterated a 16% non-GAAP margin target amid ongoing investments in AI and cloud infrastructure.

Additional News

Sprinklr expanded its global partnership with SAMY, integrating its Unified-CXM platform with SAMY’s social-first marketing services to enhance real-time customer insights for brands like Diageo. This collaboration aims to leverage AI-driven data analytics for improved campaign execution. Additionally, CFO Anthony Coletta and CPO Karthik Suri were highlighted as key leaders driving the company’s strategic priorities, including “Project Bear Hug” to deepen relationships with top 700 clients.

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