GitLab (GTLB) Posts Strong Q2 Revenue Growth Despite GAAP Losses

GitLab Inc. (NASDAQ: GTLB), a leading DevSecOps platform, has reported its financial results for the second quarter of fiscal year 2026, which ended on July 31, 2025. Performance of the company was characterized by high revenue growth albeit the company was in red according to GAAP accounting.

Financials and Business Highlights

The company delivered $236 million in revenue, a 29% increase year-over-year, underscoring continued demand for its AI-native DevSecOps platform. GitLab maintained a strong GAAP gross margin of 88%, while non-GAAP gross margin reached 90%.

On a GAAP basis, GitLab posted an operating margin of -8% with an operating loss of $18.4 million, narrowing significantly from last year’s $41 million loss. Net loss attributable to GitLab came in at $9.2 million, translating to a GAAP loss per share of -$0.06 (basic and diluted), compared to earnings of $0.08 per share a year earlier.

Cash flow improved substantially, with operating cash flow of $49.4 million versus $11.7 million in the prior year, and non-GAAP adjusted free cash flow of $46.5 million, up from $10.8 million.

Customer momentum continued, with more than $5,000 of ARR reached 10,338, an increase of 11% year-over-year, also with more than $100,000 of ARR rising 25% year-over-year to 1,344. Total remaining performance obligations climbed 32% to $988.2 million, signaling strong forward visibility.

Business highlights for the quarter included key leadership changes, with Brian Robins stepping down as CFO and James Shen named as interim CFO. GitLab also launched the public beta of its GitLab Duo Agent Platform and signed a three-year strategic collaboration agreement with Amazon Web Services (AWS) to expand access to its single-tenant offering, GitLab Dedicated.

Guidance for Q3 and FY2026

GitLab has provided a positive outlook for the third quarter and full fiscal year 2026. For Q3 FY2026, GitLab expects revenue of $238–$239 million and non-GAAP operating income of $31–$32 million. Full-year revenue is projected at $936–$942 million, with non-GAAP diluted EPS of $0.82–$0.83.

Stock Technical Outlook

Despite strong revenue growth, GTLB stock remains rangebound. The stock is facing a significant resistance level at $54. Should it successfully break through, the next resistance is at $63, with a potential target of $71-$76 if it can maintain a position above that level. However, if the stock fails to break resistance, it may seek support at $42, with a further support level at $37.