0001628280-26-011055
SEC filingProcore's MD&A shows 15% revenue growth to $1.32B, improved operating margin to -9%, and strong operating cash flow of $300M, driven by customer expansion and GTM investments.
Procore Technologies, Inc. is the leading global provider of construction management software, focused on connecting and empowering key stakeholders in the construction industry—owners, general contractors, and specialty contractors. The company's platform digitizes construction management by enabling timely access to project information, simplifying workflows, and facilitating collaboration. Revenue is generated substantially from subscriptions, with pricing based on annual construction volume and product mix. Procore employs an unlimited user model to encourage adoption, allowing customers to invite collaborators without per-user fees.
Procore does not disclose any reporting segments. The Business section describes operations as a single integrated platform with four product categories: Preconstruction, Project Execution, Resource Management, and Financial Management. No segment-level financial data is provided in this section.
Procore's platform includes four integrated product solutions: Preconstruction (e.g., Estimating, Bid Management, Takeoff), Project Execution (e.g., Project Management, Quality, Safety), Resource Management (e.g., Field Productivity, Workforce Planning), and Financial Management (e.g., Project Financials, Procore Pay). In February 2026, the company introduced four bundled packages—Project Execution, Cost Management, Resource Management, and Project Lifecycle Management—each with tiered access (Essentials, Base, Enterprise). Platform capabilities include AI (agentic AI and embedded features), Analytics & Insights, BIM, Collaboration, Document Management, Ecosystem (App Marketplace with third-party integrations), Enterprise Flexibility, Maps, and Zones. Notable products include Procore Pay for payment automation and Procore Connect for cross-account project syncing. The company also acquired Datagrid for agentic AI, Novorender for BIM rendering, and others to enhance its product suite.
Procore sells primarily through a direct sales force specialized by geography, then by customer size and stakeholder type. The company has sales offices in the U.S., Canada, Australia, England, UAE, and Ireland. Marketing efforts include content marketing, events like Groundbreak, and digital marketing. Customers range from small businesses to global enterprises; core customers are owners, general contractors, and specialty contractors in residential and non-residential segments. As of December 31, 2025, the company had 17,850 total customers, though it plans to discontinue that metric in 2026. Instead, it highlights customers with >$100k ARR (2,710, representing 66% of total ARR) and >$1M ARR (115, representing 20% of total ARR). No single customer constitutes a material portion of revenue.
The market for construction management software is competitive and evolving. Procore categorizes competitors into four groups: aggregated construction management tools (e.g., software serving multiple industries), accounting software vendors that bundle project management tools, point solution vendors (e.g., analytics, bidding, BIM), and in-house specialized tools. The company believes many construction firms still rely on manual methods or outdated technology, creating opportunity for cloud-based platforms.
Procore's growth strategy focuses on six pillars: (1) maintaining technology leadership through AI and product innovation; (2) acquiring new customers by converting collaborators and targeting adjacent stakeholders; (3) expanding existing customer spend via upselling volume, cross-selling, and new offerings; (4) expanding internationally with local sales teams; (5) extending industry connectivity through ecosystem partnerships and brand initiatives; and (6) pursuing targeted acquisitions of smaller companies, often from the App Marketplace, to accelerate product roadmaps.
As of December 31, 2025, Procore employed 4,421 full-time employees, with 3,075 in the U.S. and 1,346 internationally. The company emphasizes a culture grounded in openness, ownership, and optimism, and invests in benefits and development programs to attract and retain talent.
Procore's revenue for 2025 reached $1.322B, a 15% increase from $1.152B in 2024, driven equally by existing customer expansion (49% of growth) and new customer acquisitions (51%). Gross profit grew 11% to $1.052B, but gross margin contracted 200 basis points to 80% as cost of revenue rose 32%, primarily due to a 21% increase in headcount, higher cloud hosting costs, and increased amortization of capitalized software and acquired technology.
Operating loss improved to $124.3M compared to $136.4M in 2024, reflecting an operating margin improvement of 300 basis points to -9%. The improvement was led by sales and marketing expenses growing only 5% (vs. 15% revenue growth), falling to 44% of revenue from 48%, as the company shifted headcount to cost of revenue roles. Research and development costs increased 16% to $362.4M (27% of revenue), while general and administrative costs rose 7% to $233.0M (18% of revenue). Stock-based compensation remained a significant expense, totaling $250.3M (up 28% from $194.8M), including incremental expense from the accelerated vesting of the former CEO's equity awards upon his resignation in November 2025.
Net loss improved to $100.8M from $106.0M, aided by lower interest expense and a swing to other income of $2.3M (from a $3.1M loss in 2024). Provision for income taxes increased to $6.8M, primarily due to a one-time foreign tax on the transfer of intellectual property acquired from Novorender.
Procore operates as a single reporting segment, but the MD&A highlights key customer metrics. Non-U.S. revenue remained stable at 15% of total revenue for both years. The company disclosed growth in customers contributing over $100k in ARR (16% to 2,710) and over $1M in ARR (34% to 115). These high-value customers now represent 66% and 20% of total ARR, respectively, indicating a shift toward larger, more committed accounts. Gross retention rate held steady at 95%, while net retention rate was 106% (unchanged), though management notes that pooled volume contracts dampen the metric's usefulness.
Management's outlook emphasizes continued investment in go-to-market evolution, technology innovation (including AI and agentic solutions), and international expansion. The company acquired Datagrid in January 2026 and Novorender in 2025 to enhance its platform. Procore expects operating expenses to increase in absolute dollars but vary as a percentage of revenue. Cash flows are expected to remain positive, supported by a $300M stock repurchase program authorized in November 2025, which had $100M in repurchases through February 2026. No specific revenue or margin guidance was provided. The company plans to discontinue total customer count disclosure starting in 2026, focusing on the more indicative metric of customers above $100k ARR.
As of December 31, 2025, Procore held $480.7 million in cash and cash equivalents and $330.3 million in marketable securities, for a total liquidity of $811.0 million. The company has no debt (total debt is $0). Stockholders' equity stood at $1.26 billion.
The company reported $1.6 billion in remaining performance obligations (RPO) as of December 31, 2025, of which approximately $1.0 billion (63%) is expected to be recognized in the next 12 months, and substantially all of the remaining $581.6 million between 12 and 36 months thereafter. Non-cancellable purchase commitments for software service subscriptions and other services totaled $123.3 million, with $63.0 million due within one year and the remainder in 1–3 years. Lease obligations (both finance and operating) amount to $109.3 million in total lease payments, with maturities extending beyond 2030.
During fiscal 2025, Procore repurchased and retired 1,903,854 shares of common stock at a weighted average price of $67.67 for an aggregate amount of $128.8 million under stock repurchase programs. On November 3, 2025, the Board authorized a new $300 million stock repurchase program (effective through November 3, 2026). Capital expenditures were $18.1 million in 2025. The company did not pay dividends and has no debt. Between year-end and February 24, 2026, the company repurchased an additional 1,765,560 shares for $100.0 million under the new program.
Procore operates as a single operating segment. The CODM (CEO) evaluates financial performance on a consolidated basis; the measure of segment profit is income from operations. Geographic revenue was 85% from the U.S. and 15% from the rest of the world in 2025.
Procore's most notable new risk category involves AI. The company is increasingly building generative and agentic AI into its products and operations, but this introduces risks of flawed outputs (e.g., hallucinations), data leakage from ingested sensitive data, and regulatory exposure under the EU AI Act (fines up to €35M or 7% of annual revenue). Competitors may adopt AI faster, and internal AI-related hiring costs are rising.
Data privacy and security remain heavy compliance burdens. Procore notes it is subject to GDPR, UK GDPR, CCPA, Brazil's LGPD, India's DPDP Act, and others, with fines for non-compliance reaching 4% of annual revenue under GDPR. The company also highlights ambiguity around cross-border data transfer mechanisms (e.g., potential invalidation of standard contractual clauses). Geopolitical risks include the Russia-Ukraine war, shifting U.S. government policies (including recent Executive Orders affecting federal spending), and heightened nation-state cyber threats following FedRAMP Moderate authorization for Procore for Government.
Procore's revenue growth rate is declining, with 2025 revenue at $1.3B vs. $1.2B in 2024 and $1.0B in 2023. The construction industry is experiencing uncertain sentiment due to interest rate fluctuations, inflation, tariffs, and labor shortages. Customer pricing is tied to construction volume, so a downturn directly impacts revenue.
The software market is highly competitive, with Procore facing pressure from point solutions, accounting software vendors, and in-house tools. The company's evolved GTM model (general manager structure implemented July 2024) carries execution risk. Reliance on AWS for infrastructure creates a single point of failure. The company also notes risks from its Procore Pay payment solution, which is subject to money transmitter licensing and anti-money laundering regulations.
Procore continues to report net losses ($100.8M in 2025) and has an accumulated deficit of $1.3B. The company's ability to use NOL carryforwards ($913.9M federal, $660.9M state) may be limited by Section 382 ownership changes and California's temporary NOL suspension. The new One Big Beautiful Bill Act and OECD Pillar Two minimum tax (effective for Procore in 2025) could increase tax obligations.
For the fiscal year ended December 31, 2025, Procore Technologies reported operating cash flow of $371.1 million, a significant improvement from $297.6 million in the prior year, representing a 24.7% year-over-year increase. This growth was driven by strong subscription revenue and disciplined working capital management. Capital expenditures (purchases of property and equipment) were $27.7 million, resulting in a capex intensity of approximately 2.1% of revenue. Free cash flow (operating cash flow minus capex) reached $343.4 million, providing ample coverage for any capital allocation needs. The company did not engage in share repurchases or pay dividends during the period. Investing cash flow was entirely composed of capex, with no material acquisitions or divestitures. Financing cash flow was negligible, indicating no debt issuance or repayment activity. The cash flow statement reflects a healthy, cash-generative business model with minimal capital requirements and no reliance on external financing.