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YI

Yext, Inc. (YEXT)·Q1 2026 Earnings Summary

Executive Summary

  • Q1 FY26 delivered a clean top-line and EPS beat with revenue of $109.5M (+14% YoY) and non-GAAP diluted EPS of $0.12; adjusted EBITDA hit a record $24.7M (22.5% margin), reflecting disciplined cost execution and Hearsay integration benefits . Versus S&P Global consensus, revenue beat by ~$1.9M and EPS was modestly above the ~$0.11 mean estimate (see Estimates Context).*
  • Management raised full-year FY26 adjusted EBITDA guidance to $103–$105M (from $100–$103M previously) and introduced FY26 non-GAAP EPS guidance of $0.52–$0.54; Q2 guidance implies revenue in line with consensus and EPS at/above consensus .
  • Key KPIs inflected positively: ARR rose to $446.5M (+15% YoY) with Direct ARR +19% YoY; NRR improved to 95% (total/direct) and 96% (reseller); GRR rose to 87% total/direct and 88% reseller .
  • Product and pipeline catalysts: early traction for AI-driven Scout (1,000+ waitlist, 37 new beta customers; high value perception), momentum in Social and Hearsay, and a $200M BlackRock facility increasing strategic flexibility for M&A and buybacks .

What Went Well and What Went Wrong

What Went Well

  • Record profitability and guidance raise: Adjusted EBITDA reached $24.7M (22.5% margin) and full-year AEBITDA guidance was raised to $103–$105M, signaling durable operating leverage .
  • ARR/retention acceleration: ARR hit $446.5M (+15% YoY), with Direct ARR +19% YoY; NRR improved to 95% total/direct and 96% reseller; GRR improved to 87% total/direct and 88% reseller .
  • Scout resonance and sales enablement: CEO: “0% disinterest rate… very high value perception… demonstrates value of our Listings, Reviews, Pages and Social products,” underscoring anti-commoditization tailwind and upsell/retention support . CEO: “We exceeded guidance on both revenue and profitability, delivered record Adjusted EBITDA” .

What Went Wrong

  • Gross margin compression: GAAP gross margin declined YoY to 75.2% (from 77.6%), reflecting mix/acquisition amortization despite non-GAAP gross margin improvement to 78.6% .
  • Reseller softness: Reseller ARR declined ~1% YoY; management cited bankruptcies offsetting progress; channel remains a focus for usage-based models and second-half initiatives .
  • FX lift not structural: CFO noted a Q1 FX tailwind (GBP) benefiting ARR ($6.4M) and revenue ($0.6M); this is not a controllable growth driver and could reverse .

Financial Results

Quarterly Performance vs Prior Periods

MetricQ3 FY25Q4 FY25Q1 FY26
Revenue ($M)$114.0 $113.1 $109.5
Revenue YoY Growth+13% +12% +14%
GAAP EPS ($)$(0.10) $(0.06) $0.01
Non-GAAP EPS, diluted ($)$0.12 $0.12 $0.12
Adjusted EBITDA ($M)$23.1 $24.6 $24.7
Adjusted EBITDA Margin (%)20.3% 21.7% 22.5%

Actual vs S&P Global Consensus – Q1 FY26

MetricConsensusActualSurprise
Revenue ($M)$107.59*$109.48 +$1.89
Primary EPS ($)$0.11–$0.12*$0.12 (non-GAAP diluted) ~+$0.01

Values marked with * retrieved from S&P Global.

ARR and Mix

KPIQ1 FY26Q4 FY25Q3 FY25YoY
Total ARR ($M)$446.5 $442.7 $441.8 +15%
Direct ARR ($M)$371.9 $368.2 $374.5 +19%
Reseller ARR ($M)$74.6 $74.5 $67.3 (1)% YoY

Retention, RPO, and Deferred Revenue

KPIQ1 FY26Prior Period
Dollar-Based NRR (Total/Direct/Reseller)95% / 95% / 96% 93% / 92% / 95% (Q4 FY25)
Dollar-Based GRR (Total/Direct/Reseller)87% / 87% / 88% 86% / 86% / 87% (Q4 FY25)
RPO ($M)$469.2 (Total); $428.6 next 24 months —
Unearned Revenue ($M)$210.7 (Apr-25) $229.1 (Jan-25)

Guidance Changes

MetricPeriodPrevious GuidanceCurrent GuidanceChange
RevenueQ2 FY26—$111.0–$111.5M New
Adjusted EBITDAQ2 FY26—$24.5–$25.0M New
Non-GAAP EPSQ2 FY26—$0.12–$0.13 (assumes 124.4M basic shares) New
Adjusted EBITDAFY26$100.0–$103.0M (introduced Q4) $103.0–$105.0M Raised
Non-GAAP EPSFY26—$0.52–$0.54 (assumes 126.1M basic shares) New
Non-GAAP Tax Rate AssumptionFY2625% (FY25) 23.5% Lowered assumption

Earnings Call Themes & Trends

TopicQ-2 (Q3 FY25)Q-1 (Q4 FY25)Current (Q1 FY26)Trend
AI/Technology (Scout)Hearsay integration; AI/fragmented search backdrop Double-digit growth; positioning for AI-driven search Scout beta: 1,000+ waitlist, 37 new beta customers; high value perception; potential shorter sales cycles Accelerating adoption/visibility
Macro/TariffsNot highlightedNot highlightedCautious macro; listening to software peers; no direct tariff impact but buyer caution Cautious tone
Product PerformancePlatform interest rising; margin expansion Record AEBITDA; platform expansion Record AEBITDA; Social/Hearsay momentum; Scout catalyzing upsell Improving breadth
Retention/KPIsNoted platform efficienciesQ4: NRR 93% total NRR up to 95% total; GRR up to 87% Improving
Capital Allocation—Raised buyback authorization $200M BlackRock facility; $27.7M repurchases in Q1 (4.5M shares); continued in May More optionality
Regional/FX——GBP strength tailwind to ARR ($6.4M) and revenue ($0.6M) External tailwind in Q1

Management Commentary

  • “We exceeded guidance on both revenue and profitability, delivered record Adjusted EBITDA, and saw encouraging early adoption of new offerings.” — Michael Walrath, CEO .
  • “Sitting today with something like 45 live [Scout] customers, we’re getting amazing feedback… 0% disinterest rate… questions about the value of our Listings… Reviews… Pages… Social start to fall by the wayside.” — CEO, Q&A .
  • “We did see a bit of a tailwind from FX rates… improvement on both the revenue and on the ARR side… We also continue to see improvements in retention.” — CFO, Darryl Bond .
  • “The capital from [BlackRock] provides enhanced strategic flexibility without shareholder dilution… support growth initiatives and pursue strategic acquisitions.” — Management .

Q&A Highlights

  • Scout monetization and timing: Management expects potentially shorter sales cycles given easy implementation and strong perceived value; GA timing TBD but capacity to roll out “a lot of customers” is high .
  • Retention drivers: Fragmented search environment elevates need for best-in-class visibility tools; value perception improves, aiding gross and net retention and limiting downgrade churn .
  • Capital allocation: Company is comfortable balancing buybacks and M&A; sees shares attractive on EBITDA multiples; $200M BlackRock term loan enhances optionality (replacing SVB revolver) .
  • FX impact: GBP strength provided a non-operational lift to ARR and revenue in Q1; management called this out as a factor in results .

Estimates Context

  • Q1 FY26: Revenue beat (~$109.5M vs $107.6M*) and non-GAAP EPS met/beated ($0.12 vs ~$0.11–$0.12*), supporting the narrative of operational discipline and early product traction .
  • Q2 FY26 guidance: Revenue $111.0–$111.5M and EPS $0.12–$0.13 largely in line to slightly above consensus (~$111.2M revenue*, ~$0.12 EPS*), suggesting steady execution into Q2 .
  • FY26 outlook vs consensus: Company AEBITDA guide $103–$105M and EPS $0.52–$0.54 are below S&P Global consensus (~$123.5M AEBITDA*, ~$0.66 EPS*), implying likely downward estimate revisions unless upside emerges later in the year .

Values marked with * retrieved from S&P Global.

Key Takeaways for Investors

  • Execution + leverage: Three straight quarters of ~20%+ adjusted EBITDA margins with Q1 at 22.5% and a raised FY26 AEBITDA outlook signal improving operating leverage even as product velocity increases .
  • Product-led re-acceleration: Scout is acting as a sales catalyst and anti-commoditization layer for core products, aiding retention and expansion; watch for conversion of beta interest into ARR in 2H .
  • KPI inflection: Sequential and YoY improvements in NRR/GRR and solid ARR growth (+15% YoY) support the durability of the model; monitoring reseller stabilization remains prudent .
  • Guidance set-up: Q2 guidance is in line/slightly above consensus; full-year EPS/AEBITDA below S&P consensus suggests Street likely needs to reset FY26 expectations near company levels, which may de-risk numbers .
  • Capital flexibility: The $200M BlackRock facility and active buybacks provide optionality for accretive M&A and further anti-dilution, a potential support for the equity case .
  • Watch list: Gross margin trajectory (YoY compression on GAAP), FX normalization, reseller channel upgrades, and timing/scale of Scout monetization are the main variables into 2H .

Appendix: Additional Data

Income Statement Detail (GAAP)

Metric ($000s)Q1 FY26Q1 FY25
Revenue109,483 95,990
Gross Profit82,378 74,444
Operating Expenses81,260 79,870
Income (Loss) from Operations1,118 (5,426)
Net Income (Loss)770 (3,817)

Cash Flow and Balance Highlights

  • Operating Cash Flow: $37.7M in Q1 FY26; Free Cash Flow: $37.2M .
  • Cash, Cash Equivalents & Restricted: $132.0M as of Apr 30, 2025 .
  • Share repurchases: $27.7M (4.5M shares) in Q1; additional 1.2M shares repurchased in May .

Citations:

  • Q1 FY26 press release and non-GAAP reconciliations
  • Q1 FY26 8-K with shareholder letter, results, KPIs, and guidance
  • Earnings call transcript (Q&A themes and quotes)
  • Prior quarters’ press releases for trend analysis
  • BlackRock $200M facility press release

S&P Global disclaimer: Values marked with * are retrieved from S&P Global.