SentinelOne (S) Q3 2025 earnings summary

Executive summary

• Q3 FY25 revenue grew 28% year-over-year to $210.6 million, with ARR up 29% to $859.7 million as of October 31, 2024, and a record number of $100,000+ ARR customers added, up 24% to 1,310.

• Net new ARR growth returned to positive territory, and the company achieved positive free cash flow on a trailing-twelve-month basis for the first time.

• The Singularity platform, with advanced AI and data capabilities, continues to drive competitive differentiation and customer adoption, supported by rapid growth in Purple AI and new large enterprise wins.

• Strategic partnerships, such as with Lenovo and AWS, and expansion in the federal sector are broadening market reach and supporting long-term growth.

• The company continues to invest in AI-powered cybersecurity solutions and expanded its platform through acquisitions of PingSafe and Stride.

Financial highlights

• Q3 revenue increased 28% year-over-year to $210.6 million; international revenue up 28% and representing 37% of total revenue.

• Total ARR grew 29% to $859.7 million; net new ARR of $54 million grew 22% sequentially and 4% year-over-year.

• Non-GAAP gross margin improved to 80% (from 79%); GAAP gross margin was 75% (from 73%).

• Non-GAAP operating margin improved to negative 5% from negative 11%; GAAP operating margin was negative 42%, up from negative 50%.

• Achieved positive net income for two consecutive quarters and positive free cash flow on a trailing 12-month basis for the first time.

Outlook and guidance

• FY25 revenue guidance raised to $818 million, representing 32% growth, up from prior guidance of $815 million and 31% growth.

• Q4 revenue expected at $222 million, up 27% year-over-year; non-GAAP gross margin expected at 79% and non-GAAP operating margin at negative 3%.

• Full-year gross margin expected at 79%, up over 150 basis points from last year.

• FY25 operating margin expected at negative 4%, a 15 percentage point improvement over FY24.

• Management expects global macroeconomic headwinds, including longer sales cycles and deal downsizing, to persist in the near term.