SailPoint stock slipped after its fiscal second quarter results failed to fully satisfy investors, even as the company beat on earnings and delivered strong ARR growth.
The stock fell 0.5% to $17.70 on Wednesday, following a 5.5% drop the session before. SAIL is now down 12% for the year and has lost 14% this month alone.
Revenue for the quarter ended July 31 came in at $308.81 million, up 17% year-over-year but just short of the $310.3 million analyst consensus. Adjusted EPS of $0.09 beat expectations of $0.08 and improved from $0.07 a year ago.
SAILPOINT $SAIL Q2’27 EARNINGS HIGHLIGHTS
🔹 Revenue: $309M (Est. $310M) 🔴; +17% YoY
🔹 Adj. EPS: $0.09 (Est. $0.08) 🟢
🔹 ARR: $1.2B; +25% YoY
🔹 SaaS ARR: $847M; +36% YoYFY27 Guide:
🔹 Revenue: $1.27B-$1.28B (Est. $1.27B) 🟡
🔹 Adjusted EPS: $0.30-$0.34 (Est. $0.32) 🟡
🔹… pic.twitter.com/LlURK5ZyLh— Wall St Engine (@wallstengine) September 9, 2026
ARR rose 25% to $1.231 billion, edging past the $1.22 billion estimate. SaaS ARR grew 36% to $847 million, also above expectations.
Net revenue retention held steady at 113%, and adjusted operating margins of 20.3% beat the 18.4% estimate by a solid margin.
AI-driven ARR topped $70 million in the quarter and accounted for more than 30% of net new ARR. Over 65% of customer migrations included an AI-driven solution, and the AI-driven pipeline has more than doubled since the company’s analyst day in June 2026.
Existing customers who adopted an AI-driven solution increased their annual spend by over 60%. That’s a number worth paying attention to.
CEO Mark McClain said the company is “unifying human and agentic identity under one control plane” and called SailPoint a company that is “redefining security for the AI era.”
For Q3, SailPoint guided for revenue of $326 million to $330 million. The midpoint of $328 million is slightly below the $328.5 million Wall Street was expecting. ARR guidance of $1.288 billion to $1.292 billion came in above the $1.28 billion consensus.
BTIG analyst Gray Powell kept a Buy rating on SAIL after the print, saying the firm’s estimates were under review but calling it “a good report, with few surprises.”
TD Cowen also reiterated its Buy rating and kept its $22 price target, implying around 24% upside from current levels.
Jefferies maintained a Buy with a $23 target. Cantor Fitzgerald kept an Overweight rating and raised its target to $25. Truist reaffirmed Buy with an $18 target. RBC Capital kept Outperform with a $19 target.
SailPoint also recently closed its acquisition of Entro Security, a non-human identity and credentials security company, with plans to fold Entro’s technology into its platform.
The company reiterated its fiscal 2029 targets: $2.1 billion in ARR, at least $800 million in AI-driven ARR, at least 22% adjusted operating margins, and at least $400 million in free cash flow.
The market capitalization currently stands at $10.09 billion.
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