Samsara Inc.

Good afternoon and welcome to Samstar's fourth quarter fiscal 2026 earnings call. I'm Mike Chang, Samstar's Senior Vice President of Finance. Joining me today are Samstar Chief Executive Officer and Co-Founder, Sanjay Biswas, and our Chief Financial Officer, Dominic Phillips. In addition to our prepared remarks on this call, additional information can be found in our shareholder letter, press release, investor presentation, and SEC filings on our investor relations website at investors.samsara.com. The matters we'll discuss today include forward-looking statements. Actual results may differ materially from those contained in the forward-looking statements and are subject to risks and uncertainties described more fully in our SEC filings. Any forward-looking statements that we make on this call are based on assumptions as of today, March 5, 2026, and we undertake no obligation to update these statements as a result of new information or future events unless required by law. During today's call, we will discuss our fourth quarter fiscal 2026 financial results. We'd like to point out that the company reports non-GAAP results in addition to and not as a substitute for or superior to financial measures calculated in accordance with GAAP. We also report both actual and constant currency growth rates for certain metrics. On the call, we only provide constant currency commentary when there is a difference. Reconciliations of GAAP to non-GAAP financial measures and additional information on constant currency are provided in our press release and investor presentation. We'll make opening remarks, dive into highlights for the quarter, and open the call-up for Q&A. With that, I'll hand the call over to Sanjay.

Thanks, Mike, and thank you, everyone, for joining us today. FY26 was an outstanding year of durable and efficient growth. We ended the year with $1.9 billion in ARR, growing 30% year over year. Our $432 million of net new ARR drove this performance, growing 21% year-over-year, and demonstrating our ability to accelerate growth even as we operate at a much larger scale. Our momentum is strongest with our largest customers. We ended the year with $1.2 billion of ARR from our 100K-plus ARR customers, an increase of 37% year-over-year, and our second consecutive quarter of sequential acceleration. As we look back on FY26, it's clear we are uniquely positioned to help digitize the world of physical operations. We help these industries transform through a combination of hardware devices, cloud connectivity, deep AI, and data integrations. At the heart of our competitive advantage is our proprietary data asset, information that simply isn't found on the Internet. This includes everything from dash cam imagery captured across hundreds of millions of miles of roads daily to specific maintenance inspection workflows and service routes. We now have more than 25 trillion data points flowing through our platform every year. This data provides us with a unique mode that fuels a powerful data network effect. As we add more customers and assets, our AI models become more insightful for everyone on the platform. This creates a compounding advantage that is difficult for others to replicate. Since our founding in 2015, we've worked towards a vision of fully digitized operations. We see this transformation occurring in three distinct phases. Phase one, connecting the world's physical operations. Then phase two, analyzing the data to surface actionable operational insights. And phase three, automating entire workflows with proprietary AI agents. Let's start with phase one. Our customers are service businesses that rely on physical assets and labor and require a wide range of equipment for their operations. This includes light-duty vehicles, school buses, yellow iron construction equipment, trailers, tools, and even dumpsters. On average, our largest customers spend around 80% of their revenue on these types of assets and workers. By connecting their operations to the cloud using IoT hardware, we're building a massive and proprietary data asset that represents the physical world. This includes real-time data such as video, GPS locations, sensor readings, and diagnostics codes, which our customers use to gain operational benefits, including protecting frontline workers from false claims and liability with HD video evidence, delivering best-in-class customer service with live locations to provide accurate ETAs, and ensuring compliance with asset and worker monitoring. While customers can immediately achieve clear and fast ROI from connecting their operations to the cloud, this digitization is still in its early stages. This is due to the significant change management required to digitize revenue-generating assets. We believe the multi-decade effort to connect the world's physical operations creates a durable, long-term growth opportunity for our business. Once we've collected all the data, our customers enter Phase 2. We train purpose-built AI to surface deeper cross-functional insights that were previously unattainable. For the first time, our customers can see the direct correlation between worker behavior and long-term vehicle health, how specific service routes impact both fuel efficiency and customer satisfaction, and how real-time coaching helps prevent accidents and keep their workers safe. By applying AI to this operational data, our customers are using actionable insights to transform their operations. This includes identifying safety risks through 40-plus AI detections like drowsiness, risky weather, and passenger left behind, and correlating that risk with a worker's broader safety record. Simplifying compliance tracking by automating the verification of worker and asset qualifications and minimizing fuel spend through coaching driving behavior and intelligently suggesting the most cost-effective gas stations along their routes. Our AI analysis can now go even deeper by expanding the scope beyond a single customer, drawing actionable insights from analyzing our network of tens of thousands of customers collectively. For example, we can predict asset breakdowns by analyzing sensor data and comparing it against data from tens of thousands of assets of the identical make, model, and year to understand the average time to failure. Analyze weather risk by comparing National Weather Service data with actual camera footage from Samsara's network of millions of devices. and optimize operational performance by comparing an organization's safety records, safety scores, utilization rates, and fuel efficiency against anonymized data from industry peers to identify specific areas for improvement. These actionable insights do more than just power dashboards. They build a high-velocity, high-quality data foundation required for automation. You cannot effectively automate what you have not first unified and understood. Next, our customers enter Phase 3. Advances in AI reasoning capabilities allow us to build AI agents that take action and automate entire workflows. We're shifting the paradigm from providing insights in Phase 2, which require a human to interpret and act, to delivering automated outcomes in Phase 3. These agents will supercharge our customers' operations, giving them virtual teammates to completely transform their approach to safety, efficiency, and sustainability. As part of this, we're excited to announce our very first AI agent, the AI Safety Coach. It comprehends risk by self-reviewing data sources, such as safety event videos, worker safety records, and weather conditions. This depth of understanding allows the agent to deliver automated safety outcomes, providing real-time voice coaching in the cab and personalized end-of-week coaching videos for workers. It even dynamically adjusts safety alerts based on risky conditions, such as increasing following distances when it begins to snow. Beyond safety, our roadmap includes a suite of specialized AI agents designed to act as force multipliers for back office teams. We're developing additional AI agents to assist with compliance, maintenance, and dispatching. By automating these high-frequency complex tasks, we're enabling our customers to scale their operations without the traditional linear increase in administrative costs. To realize the full potential of these three phases, technology must be adopted by the people who power the business every day. Today, the majority of physical operations are moving into phase one or phase two of their digital transformation, which requires installation of our hardware and change management with their frontline workers. From there, the transition to phase three can happen much faster as the core parts of their operation are digitized and prepared for AI automation. The progress we've made in digitizing the world's physical operations is directly translating to our results. We partner with many of the leading physical operations organizations, including seven of the top ten food service companies, seven of the top ten waste management companies, and five of the top ten wholesale and retail companies. In Q4, we added 204 new 100k-plus ARR customers and ended FY26 with 3,194 100k customers. plus ARR customers. Our large customer momentum is laying the foundation for durable growth as these organizations adopt more products across our platform to achieve additional ROI. Large customer wins for the quarter include Southern California Edison, Groundworks, and Harris County in Texas. I'd like to share two examples of how we're expanding with our customers. The first is with one of North America's leading freight transportation companies operating a rail network of more than 30,000 route miles. Since becoming a customer in 2021, they've used our video-based safety and telematics products on their freight hostlers to build a world-class safety program. This resulted in a 90% drop in safety events and a 97% drop in distracted driving. In Q4, we expanded our partnership to include AI Multicam as they are growing their safety program. They were a top 10 win for the quarter. We estimate they will save over $12 million per year through fewer and less severe accidents, lower maintenance spend, and reduced fuel consumption. Another example is with Estes, which was also a top 10 win for the quarter. Estes is the largest privately held freight transportation company in North America. They operate over 43,000 trailers and 10,500 tractors to move 70 million pounds of freight daily. After initially partnering with Semstar for video-based safety and telematics, they expanded in Q4 to add equipment monitoring, asset tags, and connected asset maintenance, further unifying their operations on our platform. Estes is deploying asset gateways across their trailer fleet to gain real-time visibility and safety insights. They're using asset tags to track thousands of smaller, mission-critical assets, including dollies, forklifts, and ramps that are essential to their daily dock operations. They're also using connected asset maintenance to detect issues early and reduce unplanned downtime and streamline shop operations with integrated warranty and inventory management. We're proud of the impact we're making together with our customers. We introduced the asset tag 18 months ago, and our customers are rapidly adopting them to get better visibility across their operations, from heavy-duty assets to smaller tools and equipment. This is only made possible by our industry-leading, industrial-grade Samsara network. which continues to get bigger and better. In just the last two years, we doubled our network density and can now detect asset tags in near real time, providing visibility at scale that can't be replicated. We are further strengthening our network to an integration with Hubble's terrestrial network of more than 90 million consumer smartphones. This builds on Samsara's strong presence on roads, job sites, and in residential areas by extending visibility inside buildings. To continue the momentum of our asset tags, we are introducing the all-new Asset Tag XS, a form factor five times smaller than our original asset tag. It is purpose-built for more compact, high-value handheld tools and specialized equipment, such as gas meters and IV pumps. Equipment managers can now mix and match asset tags based on the size and shape of their assets. Finally, we also introduced the latest generation of our asset tags. It has six years of maintenance-free battery life, a 50% increase over the previous generation, and improved precision finding and range. We're excited to see the growing impact that asset tags are having on our customers' operations. As we close out a fantastic FY26, I want to thank our customers for their continued partnership and our team for their relentless focus on innovation. We're in the early innings of a multi-decade opportunity to transform the physical world, and I've never been more excited about the road ahead. We also wanted to share that our chief product officer, Kieran Saker, has retired. Our CTO and co-founder, John Bickett, and SVP of product management, Johan Land, will take over leadership of our engineering and product organizations, respectively. We thank Kieran for his outsized impact and customer focus, which were instrumental in growing Samsara from an early-stage idea into a multibillion-dollar business. Lastly, We're excited to announce that we will be hosting our customer conference, Beyond 2026, from June 23rd to 26th in Las Vegas. We'll also be hosting an investor day as part of the event. Beyond is our opportunity to bring together leaders from across industries to discuss the state of physical operations and new ways to deliver value through digitization. We hope you'll join us and are looking forward to seeing many of you there. I'll now hand it over to Dominic to go over the financial highlights for the quarter.

Thank you, Sanjit. Q4 was another quarter of accelerating growth and improved operating leverage. The quarter was highlighted by strong performance across several key metrics, including 31% year-over-year net new ARR growth in constant currency, the third consecutive quarter of sequential acceleration, and the highest net new ARR growth in the past eight quarters, leading to 30% total ARR growth also accelerating sequentially at a larger scale. 37% year-over-year ARR growth for 100K-plus customers, the second consecutive quarter of sequential acceleration at a larger scale, and 56% year-over-year ARR growth for $1 million-plus customers, the third consecutive quarter of sequential acceleration at a larger scale. a quarterly record 13 $1 million-plus net new ACV transactions, 23% of net new ACV from emerging products launched over the past two years, and achieving our second consecutive quarter of gap profitability. More broadly, our durable and increasingly efficient growth demonstrates the large yet still early opportunity for digital transformation across physical operations. Looking ahead, we believe we're well-positioned to deliver durable growth and create long-term shareholder value for several key reasons. The first is that we have a unique defensible data advantage. By instrumenting physical assets with IoT hardware, we generate a large and growing proprietary data asset that cannot be easily replicated. Second, we're leveraging this proprietary data to power a closed loop of intelligence and action. We use AI to surface operational insights and deploy AI agents to take action on those insights and automate workflows across the platform. This drives stronger customer engagement and expands the long-term value of our platform. Third, we have exposure to secular growth in physical infrastructure. Our business model scales with physical assets rather than headcount or knowledge workers and aligns us with end markets benefiting from major initiatives such as the global AI infrastructure build-out. The stock price performance of our top 100 public customers is up more than 30% over the past year. Fourth, our products offer a differentiated value prop and mission-critical workflows, delivering fast, tangible ROI, such as accident reduction, fuel and maintenance savings, and improved asset utilization, making us essential to our customers' operations. And lastly, we're targeting the large, less discretionary operations budget, which represents approximately 80% of our customers' revenue on average. And because we help them optimize this significant cost base, we have a large opportunity to drive customer impact and long-term growth. Okay, now turning to our results. Q4 and FY26 ending ARR was $1.9 billion, an increase of 30% year-over-year, accelerating sequentially at a larger scale. Within that, we added 145 million of net new ARR in Q4, an increase of 33% year-over-year or 31% in constant currency, resulting in the third consecutive quarter of accelerating sequential growth and the highest net new ARR growth rate in the past eight quarters. Our overall net new ARR in FY26 was 432 million, an increase of 21% year-over-year, which also accelerated year-over-year at a larger scale. and FY26 revenue was $1.6 billion, an increase of 30% year-over-year or 29% in constant currency. Several factors drove our strong top-line performance in Q4. First, large customer momentum is leading to higher growth at scale. In terms of large deals, we signed a quarterly record 13 $1 million-plus net new ECB transactions in Q4. This reflects the success of our R&D and go-to-market investments to support these larger customer opportunities. In terms of large customers, we ended Q4 with 3,194 100K plus ARR customers, including a quarterly increase of 204, our second highest quarter ever. ARR from 100K plus customers was 1.2 billion, increasing 37% year over year, resulting in the second consecutive quarter of sequential acceleration at a larger scale. 100K plus customers represent 61% of total ARR, up from 58% one year ago and 56% two years ago. Additionally, ARR from $1 million plus customers increased 56% year over year, representing the third consecutive quarter of sequential acceleration at a larger scale. Consistently over time, our ARR mix from large customers has increased, while ARR mix from smaller customers has decreased. To better reflect this trend and align with our capital allocation strategy, we're refreshing our definition of core customers to include customers with more than 25K in ARR versus 10K previously. At the end of Q4, 25K plus customers contributed 85% of total ARR, up from 83% one year ago and 81% two years ago. We expect this trend to continue and believe this update also helps investors better understand our focus on larger customers versus other competitors in the space. Second, our customers are increasingly using Samsara as their mission-critical system of action by subscribing to multiple applications on a single unified platform. 96% of our 100k plus ARR customers subscribe to two or more products and 69% subscribe to three or more. In Q4, nine of the top ten met new ACV deals, included two or more products, eight of the top ten included three or more products, and six of the top ten included four or more products. In Q4, we had a large win with one of the Midwest's largest farmer-owned co-ops. Following rapid M&A-driven growth that left data fragmented across systems, they consolidated on SAMSARA. This customer leverages route planning to digitally access daily orders, commercial navigation for safe, compliant, vehicle-aware turn-by-turn directions, and connected workflows to streamline proof-of-delivery and signatures. Additionally, telematics and video-based safety provide real-time visibility to enable proactive protection of drivers and reduce risk. In a pilot, they achieved a 65% reduction in safety events, an 85% reduction in speeding events, and a 45% reduction in idling time. Strong multi-product adoption like this helped us achieve our target dollar-based net retention rate of approximately 115% for core customers, both for our prior definition of 10K plus ARR customers and our updated definition of 25K plus ARR customers. And third, we demonstrated strong execution across several frontiers. In terms of emerging products, 23% of net new ACV in Q4 came from new products launched over the past two years, including AI multicam, asset maintenance, asset tags, commercial navigation, qualifications, routing, training, and workflows. Emerging products now contribute more than $100 million in ARR. Eight of the top 10 net new ACV transactions in Q4 included an emerging product, 58 transactions in Q4 included more than 100K in emerging product net new ACV, and asset tags ending the ARR more than tripled year over year. In Q4, we signed our largest ever asset tax deal with Total Safety, a leading provider of industrial safety services with over 250,000 assets in the U.S. Total Safety is deploying asset tax to track critical, high-value safety equipment, such as breathing air tanks, eyewash stations, and small tools to ensure asset visibility critical to their operations. By digitizing their inventory, they are increasing equipment recovery and helping their customers eliminate the high cost of lost assets. In terms of end markets, we saw strong momentum across construction, wholesale and retail trade, and public sector. Construction contributed the highest net new ACV mix of all industries for the 10th consecutive quarter and had its highest net new ACV growth in the last seven quarters. Wholesale and retail trade was our second largest vertical in Q4 and contributed its highest net new ACV mix in the last three years. And public sector FY26 net new ACV growth accelerated for the third consecutive year, including Q4 wins with the state of New York and Harris County, the third largest county in the U.S. And in terms of international, 15% of net new ACV came from non-U.S. geographies. Europe ARR growth accelerated for the fourth straight quarter, led by our largest ever European net new ACV deal with Dawson Group, the U.K.' 's largest independent asset rental, leasing, and contract hire company. And Canada had its highest year-over-year net new ACV growth in the last 10 quarters. In addition to driving strong top-line growth, we continued to deliver operating leverage across our business as we scale. In FY26, non-GAAP gross margin was 78% up 1 percentage point year-over-year. Non-GAAP operating margin was 17% up 8 percentage points from one year ago. And free cash flow margin was 13% in FY26, up 4 percentage points year-over-year. Okay, now turning to Q1 and FY27 guidance based on FX rates as of January 31st. Our guidance philosophy remains the same and is de-risked for potential downside scenarios. For Q1, we expect revenue to be between $454 and $456 million, representing 24% year-over-year growth or 22% to 23% growth in constant currency. Non-GAAP operating margin to be 15% and non-GAAP EPS to be between 12 and 13 cents. For full-year FY27, we expect revenue to be between $1.965 and $1.975 billion, representing 21% to 22% year-over-year growth or 21% growth in constant currency. Non-GAAP operating margin to be 19%, non-GAAP EPS to be between $0.65 and $0.69, and we also expect to be GAAP profitable for full-year FY27. Finally, please see the additional modeling notes in our shareholder letter. To wrap up, in Q4 and in FY26, we delivered accelerating growth at scale while expanding operating leverage across the board. Looking ahead, we believe we're well-positioned to sustain durable and efficient growth because we use hardware to generate a unique defensible data asset that we harness with AI to surface operational insights and automatically take action to drive more customer value. We are aligned with the secular growth in physical operations and markets that are benefiting from major initiatives, such as the global AI infrastructure build-out, and we deliver large, tangible customer ROI with fast payback periods. We look forward to building on this momentum as we help our customers operate more safely, efficiently, and sustainably at a greater scale. And with that, I'll hand it over to Mike to moderate Q&A.