SentinelOne (NYSE: S) shares declined more than 3% in premarket trading Friday after the cybersecurity company issued first-quarter revenue guidance that roughly matched expectations, overshadowing stronger-than-expected fourth-quarter results.
The company forecast fiscal first-quarter 2027 revenue between $276 million and $278 million, compared with the analyst consensus estimate of $277.6 million.
Full-year revenue guidance of $1.20 billion to $1.21 billion also aligned with consensus estimates, which investors interpreted cautiously.
Fourth-quarter revenue increased 20% year over year to $271.2 million, slightly above analyst estimates of $271.17 million. Adjusted earnings came in at $0.07 per share, exceeding expectations by $0.01.
Annualized recurring revenue grew 22% to $1.119 billion, while net new ARR totaled $64 million, representing a 17% increase compared with the prior quarter.
Profitability continued to improve, with non-GAAP operating margin expanding to 5.7% from 1.2% in the same quarter last year.
Management forecast about 600 basis points of operating margin expansion for the full year, targeting operating margins near 10%, a key benchmark for a company previously criticized for weak profitability.
More than 50% of new bookings came from emerging products such as cloud security, data security, and AI. SentinelOne also reported that its Purple AI platform achieved attach rates exceeding 50% on new enterprise bookings.
However, net revenue retention among customers generating over $100,000 annually declined to 109% from 112% in the previous quarter. Management cited geopolitical uncertainty as a factor behind its conservative guidance.
