Sprinklr closes fiscal 2026 with $857M revenue

Sprinklr this week reported full-year fiscal 2026 revenue of $857.2 million, closing a year the company describes as a turning point in a multi-phase operational transformation. The results, announced on March 11, 2026, beat Wall Street expectations and triggered a 9.43% surge in the stock price during pre-market trading. Yet the headline figures obscure a more complicated picture: revenue growth is decelerating sharply, customer churn remains an unresolved concern, and fiscal 2027 guidance implies total growth of just 1% at the midpoint.

For marketing professionals who use or evaluate enterprise social media management, contact center, and customer feedback platforms, the results illustrate both the promise and the difficulties of consolidating these functions onto a single AI-native platform. PPC Land's coverage of the company's Q1 fiscal 2026 results in June 2025 had already documented the churn pressure and margin compression Sprinklr was navigating mid-year. The full-year numbers now tell the complete story of that transition.

Revenue and margin performance

Total revenue for fiscal year 2026 reached $857.2 million, up 8% from $796.4 million in fiscal 2025. Subscription revenue - the recurring core of the business - grew 5% to $756.3 million from $717.9 million a year earlier. Professional services revenue rose more sharply, climbing 29% to $100.9 million from $78.5 million, driven primarily by a handful of large global implementation projects tied to Project Bear Hug, an intensive customer engagement programme. That services acceleration, however, is expected to reverse in fiscal 2027.

The fourth quarter generated $220.6 million in total revenue, up 9% year-over-year from $202.5 million. Q4 subscription revenue was $193.4 million, compared with $182.1 million in the same period a year earlier. Those numbers beat analyst forecasts of $215.51 million in total revenue, according to the earnings call transcript. Non-GAAP net income per diluted share of $0.13 exceeded the $0.09 forecast by 44.44%.

Profitability improved substantially on a non-GAAP basis. According to the press release, non-GAAP operating income for the full year was $146.2 million, up 63% from $89.8 million in fiscal 2025. Non-GAAP operating margin expanded from 11% to 17%. On a GAAP basis, operating income was $40.2 million, with GAAP operating margin moving from 3% to 5%. The gap between the two measures is wide - and it matters.

The GAAP gap: stock compensation and accumulated deficit

The divergence between GAAP and non-GAAP results at Sprinklr is significant. Stock-based compensation for fiscal 2026 was $84.4 million, nearly four times the GAAP net income of $22.9 million for the full year. The company excludes this figure, along with restructuring charges and litigation costs, from its non-GAAP calculations. Restructuring charges alone in fiscal 2026 totalled $16.8 million, compared with $2.8 million in fiscal 2025, reflecting a February 2025 workforce reduction of approximately 12%.

The balance sheet shows an accumulated deficit of $754.3 million as of January 31, 2026, up from $626.1 million a year earlier - an increase of $128.2 million in a single year. The company has not been profitable on a cumulative GAAP basis since inception. That figure is worth noting for any organisation assessing Sprinklr's long-term financial durability, even as the non-GAAP picture shows clear improvement.

Cash flow and balance sheet

Free cash flow is the most striking headline in the full-year results. According to the press release, Sprinklr generated $141.9 million in free cash flow for fiscal 2026, up 140% from $59.2 million in fiscal 2025. Free cash flow margin reached 17% for the year. The company's balance sheet at January 31, 2026, showed total cash, cash equivalents, and marketable securities of $502.5 million, with no debt. Q4 free cash flow was $15.9 million, compared with $1.5 million in the same period a year ago.

On March 8, 2026, the Board of Directors authorised a new $200 million stock repurchase programme, according to the Form 8-K filed with the SEC. The company intends to execute a $125 million accelerated share repurchase imminently, with the remaining authorisation available via open market purchases through March 15, 2027, subject to market conditions. According to CFO Anthony Coletta during the call, "We see the current share price as a compelling opportunity." The stock had traded near the lower end of its 52-week range prior to the earnings announcement, with InvestingPro estimating a fair value of $8.31 per share against a pre-market price of around $6.05.

The buyback follows $152.3 million in Class A share repurchases and related excise taxes during fiscal 2026, itself following $273.9 million in fiscal 2025. Diluted weighted-average shares outstanding fell from 274.8 million in fiscal 2025 to 258 million in fiscal 2026.

Customer churn: the unresolved problem

The most persistent challenge in the source documents is customer churn. The million-dollar customer count - enterprises contributing $1 million or more in annual subscription revenue over the trailing 12 months - fell from 149 in Q2 fiscal 2026 to 145 in Q3, and then to 141 in Q4. That is two consecutive sequential declines, and a figure that sits below the 146 reported in Q1. CEO Rory Read acknowledged "elevated churn in FY26" during every quarterly earnings call throughout the year, describing it as concentrated in the first half and particularly visible among larger enterprise accounts that had, according to his remarks, been "a bit neglected" over the prior three years.

Earlier coverage by PPC Land of Q1 fiscal 2026 results noted that the company had "experienced difficulties with managing the implementation of certain larger CCaaS projects, which has resulted in increased customer dissatisfaction, loss of certain customers and a delay in recognising revenue." The Q4 renewal rate was the best of any quarter in fiscal 2026, according to Coletta, and management expects Q1 and Q2 of fiscal 2027 to show further improvement. Whether that improvement materialises is the central question hanging over the fiscal 2027 outlook.

The net dollar expansion rate for the full customer base in Q4 was 103%, a marginal sequential increase. For the million-dollar cohort specifically, Q4 net dollar expansion was 115%, and average revenue per customer in that tier crossed $3 million. The company has said it will stop disclosing the million-dollar customer count quarterly going forward.

Revenue growth is decelerating - and the guidance confirms it

For the full fiscal year ending January 31, 2027, Sprinklr is guiding for total revenue of $869 million to $871 million - approximately 1% growth at the midpoint. Subscription revenue guidance is $778 million to $780 million, implying 3% growth. That compares with 8% total revenue growth in fiscal 2026 and 5% subscription growth. The deceleration is significant, and management attributes it to several converging factors: the lagging effects of churn from earlier in the year, a deliberate step-down in professional services, and macro uncertainty.

Professional services revenue is explicitly guided to decline - from $100.9 million in fiscal 2026 to $91 million in fiscal 2027. The reason is structural: the large Bear Hug implementation projects that inflated services revenue in fiscal 2026 are completing. Coletta described this as a normalisation toward the company's 23-year historical average of services representing around 10% of total revenue. True, but it creates a revenue headwind that subscription growth at the guided 3% rate will not fully offset on a total revenue basis.

For Q1 fiscal 2027, ending April 30, 2026, the company expects total revenue of $215.5 million to $216.5 million - representing 5% growth year-over-year at the midpoint, a step down from Q4's 9%. Non-GAAP operating income is guided at $28.5 million to $29.5 million, a sequential decline from the $37.7 million generated in Q4 fiscal 2026, implying a non-GAAP operating margin of approximately 13% in Q1 versus 17% in Q4.

Why margins will moderate in Q1

The Q1 margin compression is not incidental. Coletta cited three discrete factors during the call. First, Sprinklr is expensing what he described as "Solidatech" costs in its AI products, pushing up cloud and data hosting costs. Second, the company is investing in forward-deployed engineers and AI and R&D hiring, particularly in targeted regions. Third, Q1 includes a sales kickoff event. Those factors are all temporary or investment-related - but they are real cash costs, and they explain why non-GAAP margins are expected to run at 13% in Q1 before recovering toward the full-year target of 17%.

Rising cloud and data costs are a broader structural concern. The company acknowledged on previous calls that it is "experiencing higher data and hosting costs in response to business opportunities, especially in Sprinklr Service and our expanded AI capabilities." Subscription gross margin on a non-GAAP basis was 76% in Q4, but GAAP gross margin for the quarter was 66%, down from 71% in Q4 fiscal 2025 - compression that flows directly from those infrastructure costs.

Geopolitical and macroeconomic exposure

Management explicitly flagged the Middle East as a region of concern in fiscal 2027 guidance. Read described the region as being in the "upper middle" tier of Sprinklr's 12 regional units, with good pipeline and a resilient team, but acknowledged "the events in the Middle East, where we have a meaningful business and good pipeline" as a source of caution. The company's geographic revenue mix is roughly 50-55% from the Americas, approximately 35% from Europe, and around 10% from Asia-Pacific.

More broadly, the forward-looking statements in both the press release and the Form 8-K filed with the SEC enumerate a long list of macroeconomic risks: tariff imposition in the U.S. and abroad, potential government shutdowns, inflation and interest rate fluctuations, geopolitical conflict, and public health crises. These are standard disclosures, but the tariff reference is more pointed given the current U.S. trade environment in March 2026.

Competition in AI and CXM

The company acknowledges competitive pressure from both legacy platforms adding AI capabilities and newer AI-first entrants. The risk disclosures note that "the market in which we participate is new and rapidly evolving" and flag the difficulty of keeping pace with technological developments. Adobe launched its own AI agents for customer experience automation in September 2025, directly targeting the same enterprise buyer. Salesforce and other large software vendors have also moved aggressively into AI-driven customer engagement.

The competitive argument Sprinklr makes - that AI built natively into a platform outperforms AI retrofitted onto legacy systems - is intellectually coherent but difficult to verify. PPC Land's coverage of Sprinklr's September 2025 AI agent launch noted that independent research from Salesforce AI Research found leading AI agents achieve only 58% success rates in single-turn business scenarios and 35% in multi-turn interactions, raising questions about how AI-native claims translate to actual customer outcomes across the industry. Whether Sprinklr's architectural approach produces measurably better results remains to be demonstrated at scale.

AI growth and the four innovation priorities

Despite the competitive uncertainty, the AI growth figures within Sprinklr's own customer base are notable. According to Read during the call, annual recurring revenue from generative AI-native Sprinklr Service SKUs grew 50% year-over-year in fiscal 2026, driven by demand for AI agents, Contact Center Intelligence, and agent copilot capabilities. The platform processes more than 180 billion customer conversations per year across 30 or more channels, covering more than 400 million websites, providing the contextual data layer that management argues is essential for effective AI deployment.

For fiscal 2027, Sprinklr is executing against four innovation priorities: unified customer intelligence combining surveys, social, messaging, and video into a single insight engine; enterprise-wide automation including a no-code AI studio and more than 100 connectors; AI-driven marketing and commerce with real-time content generation; and next-generation AI including LLM-based listening and generative engine optimisation.

Project Bear Hug and the transformation phases

The phrase that appears repeatedly in the earnings call transcript is "Project Bear Hug" - an intensive customer engagement programme targeting Sprinklr's top 900 accounts, representing roughly 90% of total revenue. According to Read, the programme involves working on renewals three and four quarters ahead, a significant change from the pattern he found when he joined 15 months ago of managing renewals "within the month." The majority of full-year fiscal 2026 renewal dollars were multiyear deals, indicating an increase in average contract length.

Sprinklr is operating under a three-phase transformation framework. Phase one - business optimisation and cost restructuring - concluded in fiscal 2025. Phase two, "transition and execution," is expected to run through most of fiscal 2027. Phase three, "acceleration," is targeted for fiscal 2028. The timeline has shifted slightly: on the earnings call, analyst Patrick Walravens noted that the acceleration phase had previously been expected in the second half of fiscal 2027, and questioned whether it had now moved to fiscal 2028. Read's response was that the phases overlap, that the second phase typically runs 12-18 months, and that he expects a "better Sprinklr toward late summer, beginning of fall" - a description that leaves the timeline somewhat open.

Two flagship customer examples

Management shared two specific customer wins. The first involved an unnamed global payments company operating in more than 200 markets, where four teams - corporate communications, global brand, social care, and marketing technology - are standardising on Sprinklr by consolidating multiple legacy tools. The second was a major U.S. telecommunications provider whose annual recurring revenue with Sprinklr has doubled year-over-year and grown sixfold over two years, with the carrier's care organisation equipping more than 600 social care specialists with AI-powered listening and conversational analytics.

Remaining performance obligations and billings

Total remaining performance obligations (RPO) stood at $986.5 million as of January 31, 2026 - flat year-over-year but up 15% sequentially. Current RPO (cRPO) was $618.8 million, up 1% year-over-year and 10% quarter-over-quarter. Calculated billings for Q4 were $317.4 million, up 6% year-over-year, though $3 million below the anticipated $320 million owing to one deal that closed in February rather than January. Coletta noted that this pickup is reflected in Q1 fiscal 2027 outlook.

What this means for the marketing community

The results carry several implications for enterprise marketing teams evaluating platforms in the unified CXM category. The 50% ARR growth in generative AI SKUs is a data point that suggests real enterprise demand for AI-native contact centre and social intelligence tools, not just interest. But the decelerating subscription growth, the narrowing of the million-dollar customer cohort, and the services revenue step-down together paint a picture of a platform still working through the consequences of difficult implementations.

WPP's expanded partnership with Sprinklr, announced in late 2023, which established CX Live AI as a joint offering, had positioned the company to reach brands through one of the world's largest agency networks. Whether that partnership is now contributing measurable revenue in the enterprise accounts affected by Bear Hug is not disclosed. The Looker Studio Connector Gallery expansion in December 2025 added a Sprinklr connector via Supermetrics, enabling marketing teams to pull Sprinklr's social management data into broader business intelligence dashboards - a small but practical integration for teams already operating across multiple reporting environments.

The accelerated share repurchase of $125 million is the clearest signal of where management's own conviction lies: that the current share price undervalues the cash the business is now generating, even as revenue growth slows and the transformation extends into a third year.

Timeline

November 2023 - WPP and Sprinklr announce expanded partnership, establishing CX Live AI as a joint AI-powered CXM offering
December 2023 - Sprinklr reports Q3 fiscal 2024 results: revenue of $186.3 million, 18% year-over-year growth, highest quarterly profitability at the time
December 2023 - Sprinklr introduces Conversational AI+ for human-like conversational bots
June 2024 - Sprinklr announces expanded Reddit partnership integrating listening, advertising, and analytics
June 2024 - Sprinklr expands Snapchat partnership for unified organic and paid content management
December 2024 - Sprinklr reports Q3 fiscal 2025 results: $200.7 million revenue, 8% year-over-year growth
February 2025 - Sprinklr implements a workforce reduction of approximately 12%; $16.8 million in total restructuring charges recognised in fiscal 2026
June 4, 2025 - Sprinklr reports Q1 fiscal 2026 results: $205.5 million revenue, GAAP operating loss of $1.8 million, elevated churn; board authorises $150 million buyback
September 3, 2025 - Sprinklr reports Q2 fiscal 2026 results: $212 million revenue, 8% year-over-year; 149 million-dollar customers; Scott Millard appointed Chief Revenue Officer
September 29, 2025 - Sprinklr introduces AI Agents and Sprinklr Copilot at CXUnifiers 2025 conference in Nashville
December 3, 2025 - Sprinklr reports Q3 fiscal 2026 results: $219.1 million revenue, 9% year-over-year; 145 million-dollar customers
December 23, 2025 - Sprinklr connector added to Looker Studio Connector Gallery via Supermetrics
March 8, 2026 - Board of Directors authorises $200 million stock repurchase programme
March 11, 2026 - Sprinklr reports Q4 and full fiscal year 2026 results: $857.2 million annual revenue, $141.9 million free cash flow, non-GAAP operating income of $146.2 million; 141 million-dollar customers

Summary

Who: Sprinklr, Inc. (NYSE: CXM), a New York-based unified customer experience management platform serving more than 1,600 enterprises including 59% of the Fortune 100, led by President and CEO Rory Read and CFO Anthony Coletta.

What: Sprinklr reported Q4 and full fiscal year 2026 financial results. Total annual revenue reached $857.2 million, up 8% year-over-year. Non-GAAP operating income grew 63% to $146.2 million. Free cash flow rose 140% to $141.9 million. The Board authorised a $200 million share repurchase including a $125 million accelerated buyback. Fiscal 2027 guidance implies only 1% total revenue growth at the midpoint, with professional services revenue expected to decline and Q1 margins projected to step down from Q4 levels. Customer churn, rising AI infrastructure costs, geopolitical exposure in the Middle East, and competitive pressure from Adobe, Salesforce, and AI-first entrants represent the primary risks flagged in the results and call transcript.

When: The fiscal year covered ends January 31, 2026. Results were announced March 11, 2026. The share repurchase programme was authorised March 8, 2026.

Where: Sprinklr is headquartered at 441 9th Avenue, New York, NY 10001. The platform operates across 30 or more channels globally, with 12 regional units spanning the Americas (50-55% of revenue), Europe (approximately 35%), and Asia-Pacific (approximately 10%).

Why: The results reflect the outcome of a multi-year transformation initiated after elevated customer churn and operational difficulties in larger enterprise implementations. Sprinklr restructured its cost base, launched Project Bear Hug for customer retention, expanded AI-native capabilities, and reduced its share count through buybacks. The $200 million repurchase reflects management's view that the stock price undervalues the business relative to its cash generation, even as revenue growth decelerates and the transformation extends toward a fiscal 2028 acceleration phase.