Procore Technologies, Inc.

Hello, everyone. Thank you for joining us and welcome to Procore Technologies Inc. FY26 First Quarter Earnings Call. After today's prepared remarks, we will host a question and answer session. If you would like to ask a question, please press star 1 to raise your hand. To withdraw your question, press star 1 again. I will now hand the conference over to Matthew Police, SVP of Finance. Please go ahead.

Good morning, and welcome to Procore's 2026 First Quarter Earnings Call. I'm Matthew Pulleys, SVP of Finance. With me today are Ajay Gopal, President and CEO, and Rachel Pyles, CFO. Further disclosure of our results can be found in our press release issued today, which is available on the Investor Relations section of our website and our periodic reports filed with the SEC. Today's call is being recorded, and a replay will be available following the conclusion of the call. Comments made on this call include forward-looking statements regarding, among other things, our financial outlook, platform and products, customer demand, operations, and macroeconomic and geopolitical conditions. You should not rely on forward-looking statements as predictions of future events. All forward-looking statements are subject to risks, uncertainties, and assumptions and are based on management's current expectations and views as of today, May 5th, 2026. Procore undertakes no obligation to update any forward-looking statements except as required by law. If this call is replayed or viewed after today, the information presented during the call may not contain current or accurate information. Therefore, these statements should not be relied upon as representing our views as of any subsequent date. We'll also refer to certain non-GAAP financial measures to provide additional information to investors. A reconciliation of non-GAAP to GAAP measures is provided in our press release and our periodic reports filed with the SPC. With that, let me turn the call over to Ajay.

Good morning, everyone, and thank you for joining us. Continuing our momentum from 2025, Q1 saw strong performance that exceeded the high end of our guidance. For Q1, we delivered 15.7% revenue growth and 17% non-GAAP operating margin which represents 650 basis points of year-over-year expansion. I'm particularly pleased with these results, given the ongoing headwinds from a challenging construction environment. On our last earnings poll, I outlined why Procore will be an AI winner. Our flagship products and early investments in AI, including our acquisition of DataGrid, have positioned us well to capitalize on this disruptive technology. Building on a flagship system of collaboration with nearly 3 million active users and a massive proprietary dynamic data set, Procore AI can deliver outcomes simply not possible with traditional software. In that fall, I walked through a real example of a customer using our AI agents as a digital coworker, capable of executing complex, high-effort tasks with precision, a critical advantage for an industry facing a severe labor shortage. This also opens a meaningful new dimension to our TAM, as Procore AI can access construction labor budgets well beyond the industry's software spend. Our path forward is defined by a powerful economic duality, upside opportunity through AI monetization and downside protection through our volume-based model. I believe Procore will unlock unprecedented value as a definitive winner in the agentic AI era. I would like to begin today's call by discussing the great progress we have made with Procore AI since our last call. Then I want to discuss our continuing success with our flagship solutions. Finally, I'll discuss our intention to continue to improve margins and free cash flow per share. Let me start with Procore AI, which includes our recent acquisition of DataGrid. I am pleased that the technology integration has proceeded rapidly, leveraging the foundational security and platform investments we had made earlier in Helix. We have taken the best of both products to provide customers with new capabilities and are now executing on a combined product roadmap for Procore AI. Our solution enables customers to deploy embedded Procore AI agents that can execute tasks such as RFI analysis, submittal cross-checking, and compliance auditing. We recently released agent event triggers, which enable customers to define automated event-driven AI workflows, transitioning from reactive to proactive task execution across their projects. We're piloting a new voice AI interface designed for field workers who want hands-free access to project data on the job site. We also recently introduced a specialized contract review agent that can efficiently analyze construction documents and flag any risk in the contract. By building on the foundations already established in Procore AI, we were able to introduce this workflow in fewer than 30 days, and it is already being tested by customers. At the heart of Procore AI is a reasoning engine purpose-built for construction. It understands the language and logic of the project. For example, what an RFI is, how a submittal connects to a drawing, how a change order gets approved. On top of that, It works as a layered system that holds context across multiple steps. It doesn't just answer a question. It understands the thread. For example, why is submittal with sense, what it obligates, and what needs to happen next. Think of it as a digital co-worker that encodes the logic of construction decision-making, reasoning about a project the way an experienced practitioner would. This data and context can only be accessed within a system of record and collaboration like Procore. That capability is backed by a tool library of dozens of construction-specific capabilities, including code compliance calculators, drawing analyses, and document cross-referencing engines. And it is so early. As we continue to develop Procore AI, going deeper into our proprietary data and broader across project types, The reasoning engine will only become more capable. We expect our solution to continue to improve with every layer we unlock, and we have a long runway ahead of us. Turning to go to market, we made a deliberate decision to launch Procore AI through a dedicated specialist team working today as an overlay alongside our core sales force. The team is very small and intentionally so. The goal was to learn what the commercial motion looks like before scaling it. We are now working on translating those learnings into enablement for the broader sales force, and we expect much of our sales organization to be selling Procore AI in Q3. I'm excited that customers are adopting our agentic solutions in addition to our flagship offerings. A great example of this is within the estimating department at one of our enterprise customers, Crest Operations. Crest is already seeing transformative ROI from Procore AI. For their most complex project, bidding is an arduous process involving thousands of data points across massive sets of drawings. By leveraging Procore AI, Crest has turned a manual process that could span weeks of effort down to an automation that can take as little as 20 minutes. This isn't just an incremental improvement in speed. It is a fundamental shift in their competitive advantage. allowing them to bid more accurately, respond to opportunities faster, and ultimately drive a level of ROI that was previously unattainable. Moving to our flagship solutions, in Q1, we have driven more innovation at a faster pace than ever before. We expect that these new product capabilities will help to drive sales, increase customer satisfaction, and improve retention. I'll start with the largest and most mature part of our business today, U.S. general contractors. We have focused on improving our platform by enhancing products like quality and safety and by extending Procore Connect to support RFIs in addition to drawings. I'm particularly pleased with the general availability of the updated Procore scheduling. our natively connected scheduling solution that has already been implemented by over 2,000 companies since its February launch, making it one of the fastest adopted products in our history. Together, these releases defend and extend our leadership while opening new expansion opportunities in civil and infrastructure construction. In Q1, Trinity Group, A long-time GC customer expanded its construction volume commitment to $1.1 billion, a 6x increase. Trinity is evolving from a heavy user of siloed tools into a platform-first organization to support rapid growth and the growing complexity of large-scale builds, and is increasingly relying on the Procore platform to help run its business. Now let me move beyond general contractors. On our last call, I focused on owners, including data center operators. This time, I would like to discuss new functionality available for specialty contractors as well as international customers. For specialty contractors, we introduced materials management, which provides end-to-end supply chain visibility for self-performed contractors, from procurement and vendor management to delivery tracking to the job site. This is part of our broader investments in a purpose-built, self-reformed platform that unifies resource management, financials, and scheduling for the specialty and self-reformed contractor market. This represents a significant step in our strategy to serve the heavy construction market, where equipment costs can be just as material as labor for some projects. Also in Q1, Helm Group, a leading specialty and mechanical contractor in the Midwest, ranked number 61 on the ENR 600, significantly expanded its construction volume commitment after 18 months of successful usage. The company, which specializes in major projects like data centers and Northwestern University's new football stadium, initially started with only a portion of its construction volume. Following a successful initial rollout of project management tools, Helm Group decided to standardize in Procore. The primary goals of this expansion were to achieve increased labor productivity, mitigate risk, and streamline project management operations in a single location. Moving to international markets, we launched a new BIM Model Federation and Streaming Viewer, which enabled customers to federate and navigate large 3D building information models directly within Procore, a key requirement for winning upmarket in Europe. This is the anchor of our European Common Data Environment Strategy, which combines BIM, asset management, document management, and product execution into an ISO 19650 compliance solution. This positions Procore as the connected construction platform for markets where CDE compliance is a contractual requirement. In Q1, we signed a new contract with Cullen Construction Limited, a large general contractor headquartered in Dublin. Cullen had been using over 25 disconnected point solutions and is now standardized on Procore's unified platform to solve reporting and mobile access challenges. The customer anticipates saving over 46,000 labor hours over the next three years, the equivalent of more than 13 full-time employees, as well as decreasing non-recoverable change orders by 25%. Moving to strategic partnerships, in Q1, we announced that we are integrating the Procore platform with NVIDIA Omniverse VSX Blueprint to accelerate the building of AI factories and other critical infrastructure. This integration will establish a digital thread throughout the entire construction lifecycle to build safer, faster, and smarter infrastructure. The combination of Procore and NVIDIA solutions will enable teams to rapidly model design changes using a high fidelity, physically accurate, 3D digital twin, resulting in infrastructure that comes online faster and is optimized for peak performance. This is part of our strategy of developing meaningful relationships with leading vendors that will reap rewards in the long term. Next, I would like to briefly talk about our use of AI to enable us to grow more efficiently in the future, to increase the speed of the organization, and to improve margins. Today, Every Procore employee has access to at least one AI platform from the leading vendors. In R&D, we're in the middle of incorporating AI to transform our operating model. The parts of that organization that have already gone through this transition are able to deliver products faster and more efficiently than before. The rest of the organization will follow R&D's lead, and we expect the speed and efficiency from these changes to provide a financial model with incremental leverage in 2027 and beyond. Rachel will expand on this opportunity in a moment. And speaking of Rachel, I'd like to take this opportunity to formally welcome her to the team as our new CFO, along with our new CRO, Walt Hearn. Rachel and Walt are business and technology veterans, and each held a key leadership role with me at Ansys. They are highly qualified individuals who have been successful in vertical software. We have all worked together and know how to meet challenges and deliver value as a team. I'm excited they're joining Procore at this critical time. I have been CEO of Procore for about six months now, and my enthusiasm to the job, the company, and the construction industry has only grown. I remain optimistic for Procore's future, which is reflected in our financial performance for Q1, where we exceeded the high end of guidance and increased our full year outlook. A special thanks to my colleagues at Procore for their hard work and dedication to our customers and stakeholders. Looking to the future, Procore plans to grow its presence in the construction industry, become a winner in the AI era, and continue to compound free cash flow per share. And with that, I'd like to turn the poll over to Rachel. Rachel?