GitLab (GTLB) Q2 2025 earnings summary

Executive summary

• Q2 FY2025 revenue grew 31% year-over-year to $182.6 million, driven by new customer wins, expansion within the existing base, and strong adoption of the AI-powered DevSecOps platform.

• Net income was $12.9 million, reversing a net loss of $50.1 million in the prior year quarter, aided by a $39.4 million income tax benefit.

• Ultimate tier adoption expanded, now representing 47% of total ARR, with seven of the top 10 largest deals in Q2 being Ultimate purchases.

• Recognized as a leader in AI-powered DevSecOps by Gartner and Forrester, with significant ROI and rapid payback for customers.

• Base customers with over $5,000 ARR rose 19% to 9,314, and customers with over $100,000 ARR increased 33% to 1,076 year-over-year.

Financial highlights

• Q2 revenue: $182.6 million, up 31% year-over-year; six-month revenue was $351.8 million, up 32%.

• Non-GAAP gross margin: 91%; GAAP gross margin: 88%.

• Non-GAAP operating margin improved to 10% from (3.1)% last year; GAAP operating margin improved to (22)% from (39)%.

• Non-GAAP net income for Q2 FY25 was $24.5 million, with a 13% margin.

• Adjusted free cash flow for Q2 FY25 was $10.8 million; six-month adjusted free cash flow was $48.3 million.

Outlook and guidance

• Q3 FY2025 revenue expected at $187–$188 million, 25–26% growth year-over-year.

• Q3 non-GAAP operating income expected at $19–$20 million; non-GAAP EPS $0.15–$0.16.

• FY2025 revenue guidance raised to $742–$744 million, ~28% growth year-over-year.

• FY2025 non-GAAP operating income expected at $55–$58 million; non-GAAP EPS $0.45–$0.47.

• AI expected to be a significant growth driver in FY2026 and beyond.