0001628280-26-031230
SEC filingProcore reported strong Q1 revenue growth of 16% YoY, driven by existing customer expansion, and reduced net loss by 73%.
For the three months ended March 31, 2026, Procore reported revenue of $359.3 million, a 16% increase compared to $310.6 million in the same period last year. This growth was primarily driven by existing customer expansion, which contributed 87% of the revenue increase, and new customer acquisition contributing 13%. Gross profit rose 17% to $287.8 million, with gross margin improving by 100 basis points to 80% (84% on a non-GAAP basis), reflecting lower cost of revenue growth (10% YoY) relative to revenue. Cost of revenue increases were largely due to higher amortization of capitalized software costs and third-party cloud hosting.
Operating expenses grew more slowly than revenue, at 8% for sales and marketing, a 2% decline in R&D, and 23% for G&A. The overall operating loss narrowed significantly to $15.7 million from $36.2 million, a 57% improvement. The G&A increase was notably driven by $8.8 million in legal fees related to an ongoing lawsuit with Oracle and $1.2 million in acquisition-related expenses. Net loss improved by 72% to $9.1 million from $33.0 million, aided by a $7.2 million income tax benefit from the release of a valuation allowance related to the Datagrid acquisition. On a non-GAAP basis, operating profit reached $60.8 million, representing a 17% margin, up from 10% in the prior year.
Procore reports on a single operating segment. Key operational metrics indicate strong momentum in the enterprise customer base. The number of customers with over $100,000 in annual recurring revenue (ARR) grew 16% year-over-year to 2,795. The gross retention rate remained stable at 95%, indicating high customer stickiness. Current remaining performance obligations (cRPO) grew 21% YoY to $1.02 billion, with 59% of the increase attributable to new customers and 41% to existing customers. Non-U.S. revenue remained consistent at 15% of total revenue.
Management's outlook is positive, emphasizing continued investment in international expansion, technology innovation (Procore AI), and strategic acquisitions (Datagrid). The company expects to maintain its high gross retention rate and sees opportunities to expand its large market. The stock repurchase program has $200 million remaining under the current $300 million authorization through November 2026. Management believes the evolved GTM operating model will improve long-term efficiency and is focused on driving sustainable growth despite near-term macroeconomic headwinds. No specific quantitative guidance has been provided for future periods.