Samsara (IOT) Q4 2026 Earnings Call Transcript

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Date

Thursday, March 5, 2026 at 5 p.m. ET

Call participants

• Chief Executive Officer and Co-Founder — Sanjit Biswas
• Chief Financial Officer — Dominic Phillips
• Vice President, Investor Relations — Mike Chang

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Takeaways

• Annual recurring revenue (ARR) -- $1.9 billion, increased 30% year over year with sequential acceleration at scale.
• Net new ARR -- $432 million for the year and $145 million for the quarter, up 21% and 33% year over year, respectively.
• $100K+ ARR customers -- 3,194 customers, up by 204 this quarter and 37% year over year, driving 61% of total ARR, compared to 58% last year and 56% two years ago.
• $1 million+ ARR customers -- 56% year-over-year ARR growth, with a quarterly record of 131 net new ACV transactions in this category.
• Multiproduct adoption -- 96% of $100K+ ARR customers used two or more products, and 69% used three or more; top deals frequently featured three-plus products.
• Emerging products -- Contributed 23% of Q4 net new ACV, up from 8% in Q2 and 20% in Q3; now over $100 million in ARR.
• Asset tags segment -- Asset tags ending ARR more than tripled year over year; largest-ever deal signed in Q4 with Total Safety, covering over 250,000 assets.
• Segment performance -- Construction vertical led for the tenth consecutive quarter; public sector saw its net new ACV growth accelerate for the third straight year.
• International -- 15% of net new ACV from non-U.S. geographies; Europe ARR growth accelerated for the fourth consecutive quarter.
• Non-GAAP margins -- Fiscal 2026 gross margin at 78% (up one point), operating margin at 17% (up eight points), and free cash flow margin at 13% (up four points) year over year.
• GAAP profitability -- Achieved for two consecutive quarters; guiding for full-year GAAP profitability in fiscal 2027.
• Fiscal 2027 guidance -- Revenue expected between $1.965 billion and $1.975 billion (21%-22% year-over-year growth), operating margin of 19%, non-GAAP EPS of $0.65 to $0.69.
• AI product strategy -- Announced launch of AI Safety Coach agent and roadmap for additional AI agents in compliance, maintenance, and dispatching.
• Asset tag product expansion -- Introduced Asset Tag XS, five times smaller than the original, and new asset tag version with 50% longer battery life (six years) and improved finding capabilities.
• Leadership change -- Chief Product Officer Kieran Saker retired; CTO John Bicket and SVP Johan Land to assume product and engineering leadership.

Summary

Samsara (NYSE:IOT) accelerated top-line and large customer growth while further expanding margins and achieving GAAP profitability. Management emphasized the accelerating contribution of emerging products, with asset tags and multi-product deals fueling record large-customer transactions and broader platform adoption. International expansion, especially in Europe, displayed sustained momentum through landmark deals and targeted investments.

• Recent product launches, including the AI Safety Coach agent and Asset Tag XS, signal an ongoing focus on automation and deeper asset visibility.
• Management confirmed that most Q4 performance resulted from new bookings rather than deferred ramp-up from previous quarters.
• Sales organization will see evolutionary rather than structural changes, with incremental investments in global account and product specialist roles for fiscal 2027.
• Equity-based compensation as a percent of revenue was 20% in fiscal 2026, expected to decline further in fiscal 2027 as cost discipline continues.
• Supply chain risks tied to memory pricing increases, especially NAND, were described as managed within guidance, with no structural margin change forecast.

Industry glossary

• ACV (Annual contract value): Measures the yearly value of a contract, often referenced for large enterprise customer transactions.
• ARR (Annual recurring revenue): The annualized value of all active recurring contracts at a point in time, used to assess SaaS scale and growth.
• Asset tag: Industrial IoT hardware device used for real-time tracking and management of physical assets, from vehicles to tools, within the Samsara platform.
• AI Safety Coach: Samsara's proprietary AI agent launched to automate driver safety coaching and real-time risk detection using integrated operational data.
• Net new ARR: The incremental ARR added during a specific period, net of churn.

Full Conference Call Transcript

Sanjit Biswas: Thanks, Mike, and thank you everyone for joining us today. FY 2026 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 much larger scale. Our momentum is strongest with our largest customers. We ended the year with $1.2 billion of ARR from our $100K+ ARR customers, an increase of 37% year over year, our second consecutive quarter of sequential acceleration.

As we look back on FY 2026, it is 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 is not simply found on the Internet. This includes everything from dashcam imagery captured across hundreds of millions of miles of road 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 the unique moat 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 have 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 us 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 are 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 have collected all the data, our customers enter phase two. 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+ AI detections like drowsiness, risky weather, and passenger left behind, and correlating that risk with the worker's broader safety record; simplifying compliance tracking by automating the verification of worker and asset qualifications; 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 breakdown 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 Inc.'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 three. Advances in AI reasoning capabilities allow us to build AI agents that take action and automate entire workflows. We are shifting the paradigm from providing insights in phase two, which require a human to interpret and act, to delivering automated outcomes in phase three. 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 are 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-the-day and 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 are developing additional AI agents to assist with compliance, maintenance, and dispatching.

By automating these high-frequency, complex tasks, we are 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 have 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 10 food service companies, seven of the top 10 waste management companies, and five of the top 10 wholesale and retail companies. In Q4, we added 204 new $100K+ ARR customers and ended FY 2026 with 3,194 $100K+ 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 would like to share two examples of how we are 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 have used our video-based safety and telematics products on their freight hustlers 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 Samsara Inc. 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 are 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 are also using connected asset maintenance to detect issues early, reduce unplanned downtime, and streamline shop operations with integrated warranty and inventory management. We are proud of the impact we are making together with our customers. We introduced the asset tag eighteen 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 Inc. 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 cannot be replicated.

We are further strengthening our network through an integration with Hubble's terrestrial network of more than 90 million consumer smartphones. This builds on Samsara Inc.'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 tag.

It has six years of maintenance-free battery life, a 50% increase over the previous generation, and improved precision finding and range. We are excited to see the growing impact that asset tags are having on our customers' operations. As we close out a fantastic FY 2026, I want to thank our customers for their continued partnership and our team for their relentless focus on innovation. We are in the early innings of a multi-decade opportunity to transform the physical world, and I have 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 cofounder, John Bicket, 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 Inc. from an early stage idea into a multibillion dollar business. Lastly, we are excited to announce that we will be hosting our customer conference Beyond 2026 in June in Las Vegas. We will 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.

Hope you will join us and are looking forward to seeing many of you there. I will now hand it over to Dominic to go over the financial highlights for the quarter.

Dominic Phillips: 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+ customers, the second consecutive quarter of sequential acceleration at a larger scale; and 56% year-over-year ARR growth for $1 million+ customers, the third consecutive quarter of sequential acceleration at a larger scale.

A quarterly record 131 $1 million+ 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 GAAP 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 are 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 are 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 customers is up more than 30% over the past year.

Fourth, our products offer a differentiated value prop in mission-critical work, 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 are targeting the large, less discretionary operations budget, which represents approximately 80% of our customers' revenue on average. 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 FY 2026 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 FY 2026 was $432 million, an increase of 21% year over year, which also accelerated year over year at a larger scale. FY 2026 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 131 $1 million+ net new ACV 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+ ARR customers, including a quarterly increase of 204, our second-highest quarter ever. ARR from $100K+ customers was $1.2 billion, increasing 37% year over year, resulting in the second consecutive quarter of sequential acceleration at a larger scale. $100K+ customers represent 61% of total ARR, up from 58% one year ago, and 56% two years ago.

Additionally, ARR from $1 million+ 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 are refreshing our definition of core customers to include customers with more than $25K in ARR versus $10K previously. At the end of Q4, $25K+ 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 Inc. as their mission-critical system of action by subscribing to multiple applications on a single unified platform. 96% of our $100K+ ARR customers subscribed to two or more products, and 69% subscribed to three or more. In Q4, nine of the top 10 net new ACV deals included two or more products, eight of the top 10 included three or more products, and six of the top 10 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 Inc. 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 multiproduct 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+ ARR customers and our updated definition of $25K+ 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 ARR more than tripled year over year. In Q4, we signed our largest-ever asset tags 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 tags to track critical, high-value safety equipment such as breathing air tanks, eye wash 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 tenth 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 FY 2026 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. 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 UK'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 ten quarters. In addition to driving strong top line growth, we continued to deliver operating leverage across our business as we scale. In FY 2026, non-GAAP gross margin was 78%, up one percentage point year over year. Non-GAAP operating margin was 17%, up eight percentage points from one year ago, and free cash flow margin was 13% in FY 2026, up four percentage points year over year. Okay.

Now turning to Q1 and FY 2027 guidance based on FX rates as of January 31. Our guidance philosophy remains the same and is de-risked for a potential downside scenario. For Q1, we expect revenue to be between $454 million 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 $0.12 and $0.13.

For full-year FY 2027, we expect revenue to be between $1.965 billion 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%; and non-GAAP EPS to be between $0.65 and $0.69, and we also expect to be GAAP profitable for full-year FY 2027. Finally, please see the additional modeling notes in our shareholder letter. To wrap up, in Q4 and in FY 2026, we delivered accelerating growth at scale while expanding operating leverage across the board.

Looking ahead, we believe we are 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 end 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. I will now hand it over to Mike to moderate Q&A.

Mike Chang: Thank you, Dominic. We will now open the line up for questions. When it is your turn, please limit your questions to one main question and one follow-up question. The first question today comes from Matt Hedberg with RBC, followed by Keith Weiss with Morgan Stanley.

Matthew George Hedberg: Hey, guys. Can you hear me? Great. Thanks again, and great job this quarter. You know, a lot of positives to pick through here. The emerging product success was certainly a stand reaching two really significant milestones. I guess, as you look to the future and, by the way, I think you guys outlined a really, really compelling reason why data is at the core of Samsara Inc. and why that is extremely defensive and, in fact, offensive in an AI environment. Can you talk about, though, where you are seeing some of the best adoption rates for some of these emerging products? Is it across all your customers? Is it some of your larger particular verticals?

Any sense for just how those emerging products are distributed?

Sanjit Biswas: Hey, Matt. This is Sanjit. I will take that one. I would say we are seeing very strong momentum, especially with large customers because they have the most complex physical operations—thousands, often tens of thousands, of frontline workers and a similar, probably larger number of assets. So when we introduce new technologies like commercial navigation, maintenance, training, they are very well received because they know immediately how to put that technology to work. So I would say if I had to choose a pattern, it would be among these larger customers where they are set up to absorb these new products.

Mike Chang: Okay. The next question comes from Keith Weiss with Morgan Stanley, followed by Alex Zukin with Wolfe.

Keith Weiss: Excellent. Thank you guys for taking the question, and congratulations on a really outstanding quarter and year. Two—well, really, two questions I want to ask. One more tactical, one more strategic. On the more tactical side of the equation, the acceleration that we have seen over the past couple of quarters in net new ARR—is it too simple to say that this is sort of asset tags and that new solution ramping up within the product portfolio, or is there a broader set of drivers that are behind that acceleration? And then on the more strategic side, coming out of the Morgan Stanley TMT conference, we have been talking a lot about proprietary data.

One of the debates that emerged is how the value of data sustains over time, and I would love to hear your view on it in terms of the relative value of the data when it is brand new and it is just coming off of the devices versus how much value it retains as it becomes older and older and becomes part of that bigger dataset that you have over time. Thank you so much.

Dominic Phillips: Hey, Keith. This is Dominic. I will go for the first one, then Sanjit can take the second one. I think the acceleration—the net new ARR acceleration over the last three quarters—has been much broader than something simply as asset tags. Broadly, as a bucket, the emerging products have definitely been big contributors, going from 8% of the net new ACV mix in Q2 to 20% in Q3, and then 23% in Q4. Asset tags have been important within that, but once again, we did not see one product within the emerging products driving more than 50% of that contribution.

I think it has been a lot of large customer momentum and success—again, a quarterly record 131 $1 million+ net new ACV transactions; our second-highest quarter ever of $100K+ adds. We are seeing good momentum internationally and then in specific verticals—construction and wholesale and retail and public sector this quarter were all strong. So emerging products are definitely playing a role, but the strength and the growth have been much more broad than that.

Sanjit Biswas: And, Keith, on the proprietary data angle, we think there is a lot of value in the accumulation and really the data asset that builds up over time. I will give you one or two concrete examples. Maintenance is actually one that our customers have really started taking to. We have a tremendous amount of information about what happens with the specific make, model, year of a truck. So, for example, if you have a 2020 Freightliner Cascadia, how does it wear over time? What have others seen? Where does it start to break down? Where do maintenance costs go up? That is from the accumulation of a lot of data over time.

The same philosophy applies to things like risk data. You want to understand how millions of drivers over different weather conditions over time, different tenures at their company, and different risk patterns behave. So it is not just the in-the-moment data—that is, of course, valuable—but it is really being able to look at it over time and across customers. That is where it accumulates to be something really interesting.

Keith Weiss: Awesome. Thank you so much, guys.

Mike Chang: Great. The next question comes from Alex Zukin with Wolfe Research, followed by Michael Turrin with Wells Fargo.

Aleksandr J. Zukin: Yeah, guys. Thank you for taking the question. I echo my congratulations on a really, really strong quarter. Maybe first one for you, Sanjit. Just the AI offering that you launched—the agentic offering—maybe help us understand a little bit of how you plan to monetize that within your customer base. I think you listed a few that are on the horizon. Maybe talk to us a little bit about your vision for introducing that type of functionality and how the pricing evolves around that. And then, Dom, it is your largest net new ARR beat as a public company despite the conservatism you always embed in the guidance.

We are starting with a two percentage point expansion on a larger scale, implying the largest starting incremental margin guidance for a fiscal year guide. So maybe walk through the momentum that you are seeing in existing and new customers that gives you that confidence to embed that sales efficiency to start the guidance.

Sanjit Biswas: Sure. I will start with the agentic question. AI agents are a new concept to the world and very new in the world of our customers. We are getting these products out there to understand better how they are going to use the agents—how often they are used, the patterns, and so on. That will give us the data we need to figure out the right pricing model that both is a fair share of value, but also matches how the customers use the product. We will have more to come there.

We will really get these out there starting in the summer with Beyond, and we are excited not just about the safety agent, but also the maintenance, compliance, and the other virtual team members we can add to our teams.

Dominic Phillips: Yeah. I would say that we have—again, Q4 was fantastic—but we have really had three consecutive quarters now of accelerating net new ARR growth. A lot of momentum, obviously, to end FY 2026 and then taking us into FY 2027. I think not only have we demonstrated a lot of accelerating growth, but we have also done so by getting more efficient, again, across the board. We are finding ways to operate more efficiently. We are using a lot of AI tools internally to drive a lot more productivity. Even looking at something as simple as ARR per employee, that has increased every year over the last several years.

I think it is up more than 30% over the last three years. We are able to drive a lot more top-line scale while doing so much more efficiently, and that gives us confidence that we can continue that into FY 2027. Great. Thank you.

Mike Chang: The next question comes from Michael Turrin with Wells Fargo, followed by Matt Martino with Goldman Sachs.

Michael James Turrin: Hey. Thanks very much. I echo my congrats as well. The Q4 results are really impressive, even for Samsara Inc. in a Q4. So the first question is, you had a lot of rich detail in there, but help us with where the sources of upside came from and if anything at all surprised you relative to what you were expecting. As a second part to that, how that shades what you are framing to us for fiscal 2027 as well, Dom.

Dominic Phillips: Yeah. Again, as we just talked with Alex, third consecutive quarter of net new ARR acceleration; strongest net new ARR growth in eight quarters; and so much net new ARR acceleration that the overall $1.9 billion of ending ARR accelerated back up to 30%. Again, large customers, a lot of large deals—the record 131 $1 million+ transactions—and then the 204 $100K+ adds was very strong. Tied into the emerging products, we are just seeing much larger multiproduct transactions. Nine of the top 10 deals had two-plus products, eight of the top ten three-plus, and six of the top ten four-plus. So a lot of multiproduct strength driving the growth.

We are getting contribution from these emerging frontiers, whether it is the emerging products at 23%, international, or some of these verticals. So three consecutive quarters of acceleration and a lot of growth strength, and that gives us a lot of good momentum going into 2027.

Michael James Turrin: Yeah. Congrats again. Thanks very much.

Mike Chang: Next question comes from Matt Martino with Goldman Sachs, followed by Matt Bullock with BofA.

Matt Martino: Yeah. Thanks for taking the questions, guys. Sanjit, for you, asset tags clearly feel like something much bigger. As you introduce the XS form factor and bring in Hubble to extend the network, how should we think about the strategic end state there? Is this mainly about driving deeper within the base, or does this really start to open up an entirely broader asset visibility platform for you guys?

Sanjit Biswas: Yeah, Matt. I would say it is definitely both. The world of physical operations has a ton of assets. There are, of course, vehicles and trailers and construction equipment, but I mentioned a lot of the smaller handheld assets—tools, dollies, and so on. Really, our first priority here is, like I said with phase one, we are just simply trying to digitize and get this information into the cloud so we can start operating on it. As we do that, I think it does open up a lot of interesting use cases. Many of our customers are interested in things like asset dormancy—Which pieces of equipment have not moved?

Maybe they do not need to own them and they could rent them instead. There are definitely sophisticated ways to load balance where those assets are placed. I do think there is this agentic opportunity. All of that will appeal to our existing customers, and I do think this will open up some new possibilities—maybe some customers that do not have a tremendous number of vehicles but have a lot of other kinds of field assets. We highlighted Total Safety, for example. They have about 250,000 assets. That would be a good example of one.

Mike Chang: Great. The next question comes from Matt Bullock with BofA, followed by Derrick Wood with TD Cowen.

Matthew John Bullock: Great. Thanks. Sanjit, I wanted to ask about the public sector. Annual net new ACV growth accelerated for the third consecutive year here. It is now a $100 million+ ARR business that is pretty clearly benefiting from network effects. My question was about legislation or the policy environment. We noticed that Samsara Inc. presented to Congress twice during February. What was that about specifically? Are there any legislative tailwinds that we should have on our radar as we enter fiscal 2027?

Sanjit Biswas: Yeah. Absolutely. We are very excited about momentum in the public sector. Just as a reminder, the public sector has a lot of physical operations that are required to maintain and really run all of our communities. A lot of the reason that we are providing so much information to Congress is simply to educate. We want them to understand the benefit of these technologies, not just in the public sector but even in the private sector. Our products have a huge impact on safety and efficiency, and it is part of this bigger digitization trend. So there, I would say the work has really been around education, first and foremost.

In the public sector itself, I think we are seeing some great network effects, as you highlighted. Cities and states are not competitive with one another. When you unlock value for one, they tend to talk about it and tell others about it.

Matthew John Bullock: That is fantastic. And if I could squeeze one more in for Dom. Obviously, the large deal momentum was excellent in Q4, but I wanted to ask about helping frame the contribution from large deals that were ramping from Q2 and Q3. Just helping us understand what the contribution was from prior deal momentum in Q4 given the pretty huge net new ARR number.

Dominic Phillips: Yeah. Most of the Q4 performance and results were driven by new deals booked and signed in the quarter. I assume the one that you are referring to in Q2 is the First Student transaction. That was a large deal that we signed in Q2 and is a phased rollout. We got some of that contribution in Q4. It will continue to be rolled out over time. But most of the bookings and the net new ARR in Q4 were the result of new deals—whether they are expansions to existing customers or signing new customers—that were booked in the quarter.

Matthew John Bullock: Got it. Thank you.

Mike Chang: The next question comes from Derrick Wood with TD Cowen, followed by Jim Fish with Piper Sandler.

Derrick Wood: Great. I will echo my congrats as well. I guess, Sanjit, just going back on the vertical discussion—construction, tenth consecutive quarter in a row of strength. How much of that is being driven by physical AI data center infrastructure build-outs, and what are some of the other drivers? And then given the projected tens of gigawatts of data center capacity expected to be stood up over the next couple of years, can you talk about the strength of your pipeline, not only in construction but those other verticals—energy, utilities, field services—that are tied to data center builds?

Sanjit Biswas: Sure. So, Derrick, construction was absolutely another strong vertical for us this quarter. I would say that a significant number of our customers are involved in this AI data center build, but they are also helping build and maintain roadways and buildings and all the infrastructure that powers the planet. While it has been a tailwind in general in the construction industry, there are a number of different areas of interest there. On the side, we see electrical utilities and other trades. We work with a lot of electric contracting companies, for example. They are all involved in this AI data center build-out. It has really been an interesting macro tailwind or effect in that industry.

In the adjacent industries, as you highlighted—utilities and field services—too.

Derrick Wood: Great. And if I could squeeze one for Dom, speaking of macro. We have not got any questions on whether the rise in memory prices would have any impact on your margins or cash flow or supply chain dynamics—anything to flag to think about potential impact on the model?

Dominic Phillips: Yeah. We are definitely seeing some increase in memory. For us, it is more on the storage side—more on the NAND side—than on the memory side. We have operated through different supply chain disruptions. We have a very nimble supply chain team that is really well prepared to handle and navigate the current dynamics. We went through something similar in 2022. Most importantly, we were able to meet all customer demand while driving free cash flow leverage, and we feel like we are in a similar position now. We have factored this into the modeling notes—into the gross margin and the 100 basis points of free cash flow leverage that we started with in the notes.

Also, from a competitive standpoint, we think that we are best positioned and best capitalized to navigate through this. This could be an opportunity for us to increase market share. Ultimately, we obviously think that the prices are going to stabilize over time, and we do not see any long-term structural changes to our financial profile.

Derrick Wood: Great. Thank you.

Mike Chang: The next question comes from Jim Fish with Piper Sandler, followed by Alex Sklar with Raymond James.

James Edward Fish: Hey, guys. Thanks for the question here. Look, I think a lot of people here are impressed by the emerging product side of things. Dom, another quarter north of 20% here. Seems like this is starting to become the new norm. I guess, how are you guys thinking about it for the annual guide here? Was it fairly balanced again, or are a few of the products underneath starting to lead a little bit more? And, Sanjit, for you—was Tags XS a customer-driven ask? Why this version? How should we think about capability difference or price difference? Thanks, guys.

Dominic Phillips: Yeah. From the emerging products side, very similar to the previous quarters—it was very widespread. There was not one of the emerging products that drove more than 50% of the bookings. We saw pretty broad-based strength, and we have good momentum across all of those products going into 2027.

Sanjit Biswas: Yeah. In terms of Asset Tag XS, it very much was customer-driven. Customers tried the original asset tags and really liked the functionality. Many of these customers have smaller, often handheld tools where they needed something that basically had less volume. That is where that ask came from, and that is why we built XS. The pricing is similar to the original asset tag family. It is really the form factor that is different.

James Edward Fish: Got it. Thank you.

Mike Chang: The next question comes from Alex Sklar with Raymond James, followed by Peter Berkley with Evercore.

Jonathan McCary: Hey, guys. Thank you. This is Jonathan McCary on for Alex. Sanjit, I will start with you. You guys called out success in Europe again this quarter, so I wanted to ask how you are thinking about resourcing to that region as we head into fiscal 2027. Then, conceptually, how much of a priority is geo expansion over the next few years? And then tangentially for Dom, I wanted to ask on the hiring embedded in the outlook for the year. You have continued success in Europe, but you are also seeing product velocity that seems like it continues to pick up.

So I am curious where you are adding more manpower across the business, and which areas are driving the leverage embedded in the guide. Thanks, guys.

Sanjit Biswas: Yeah. I will take the first part of that. We are, again, very pleased with the progress in Europe. Dawson Group, Petit Forestier, ASDA, Fraikin—these have all been huge lands for us. They are very well-known companies in the geo. I think it is just going to be continued investment and effort. We are planning to be consistent there, and we are making the product investments that are required as well in terms of the features and functionality that are required. If we take a step back, we play in some of the most important geographic markets today between North America and Western Europe. I think it is really about the follow-through and really helping digitize these large-scale operations.

We still have a long way to go, which we are excited about.

Dominic Phillips: Yeah. On the hiring front, I touched on this a little bit earlier, but we expect FY 2027 is going to be another year of productivity improvements. I used the stat that over the past three years, the ARR per employee is up more than 30%. We expect it will increase again in FY 2027. Most of the hiring in FY 2027 will be in our go-to-market and sales-related roles. Most of the other functions are going to be roughly the same size—maybe some smaller—which we expect will drive leverage across all of the OpEx line items.

Mike Chang: The next question comes from Peter Berkley with Evercore, followed by Jackson with William Blair.

Peter Berkley: Yeah. Hi, guys. This is Pete Berkley on for Kirk Materne. Appreciate you taking the question, and congrats on a really strong quarter here. I want to focus again on the large customer segment and the really strong growth and acceleration in the $100K ARR segment and the $1 million+ ARR segment as well. I am curious if you could unpack some of that strength—whether it is primarily multiproduct attach or some of the emerging products like asset tags and AI Multicam—or if you are seeing a broader fleet and asset expansion underneath the hood in some of those larger customers.

And then just curious how much runway remains to continue to expand ARPU within that really large ARR customer base. Thanks.

Dominic Phillips: Sure. I would say on the large customers, it was weighted a little bit more towards existing customers doing expansions. Multiproduct adoption across the board definitely drove strength. Almost all of those are licensing the core vehicle-based products—telematics and video-based safety. As I said, eight out of the top 10 had three-plus products, and six of the top 10 had four or more—so licensing something outside one of these emerging products, which was also quite strong for us. Similarly, even on the new logo side, the large new customer lands were all multiproduct transactions out of the gate.

Peter Berkley: Great. Thanks much.

Mike Chang: The next question comes from Jackson with William Blair, followed by Jason Celino with KeyBanc.

Jackson: Thanks for taking my question. This is Jackson on for Dylan Becker. We have talked about the substantial dataset. You have more than 25 trillion data points on the platform. Large customers are doing more. There are more products in earlier stages of development and adoption. Altogether, I was curious if you could speak to how all of these things really allow you to accelerate the time to value with customers and really support the already considerable value proposition that you guys offer customers.

Sanjit Biswas: Yeah. I think, first of all, we are excited to be able to expand the platform. This really expands areas of value more than anything else. For example, with maintenance, that was something we were not doing as much in before, but it is a tremendous area of expense for our customers who have a lot of assets. Time to value continues to be strong. Our customers realize this ROI within a year. So that has never really been an issue of how we speed that up. I am excited about helping drive that already 8x ROI that we see with customers even broader as we expand into adjacent areas like maintenance, training, qualifications, workflows, and so on.

Jackson: Got it. That is super helpful. And then one more quickly if I could. There is a lot of geopolitical turmoil going on in multiple regions. How should we think about the impact to the business internationally? Expansion plans? Would you even say the heightened uncertainty may be a tailwind or headwind to potential adoption? I am just curious—any color you would have on the current macro landscape.

Sanjit Biswas: I think for us, again, as on an earlier question, we are pretty focused on North America and Western Europe. There are 35 million commercial vehicles here in North America. There are 45 million in Western Europe. We feel that the markets we are selling in are ready for this kind of digital transformation. They are adopting these technologies, so we are going to stay focused in the geographies we are in.

Mike Chang: Great. Next question comes from Jason Celino with KeyBanc, followed by Nick Altman with BTIG.

Jason Celino: Great. Thank you for taking my question. Maybe my first one—I think it was mentioned that you have 40 different AI detections. I do not know if this is a new way to frame it, but how many of these are powered by AI-type models, or can they be powered by the same models? And then when we think about the categories of some of these detections, are they more than just safety-based detections?

Sanjit Biswas: Sure. These are all different forms of AI detection. Some of them involve technologies like large language models. Others are more time-series-based models. We are continuously expanding the library of types of detections. Safety is, of course, an important area for these detections, but we are thinking about AI models much more generally. We look at things like weather conditions and road conditions. We are looking at other vehicle and asset health-related AI models. We are continually expanding, but they build on a number of different technologies.

Jason Celino: Okay. Great. And then maybe just a quick one for Dom—SBC philosophy. You are guiding to GAAP full-year profitability, which is refreshing. But maybe refresh us on how you are thinking about SBC as a whole and its trajectory.

Dominic Phillips: Yeah. We view equity-based compensation as a real cost of the business. We forecast that we are driving leverage. I think we were in the high 20s four years ago when we went public. We got it down into the low 20s last year in FY 2026. It was 20%. We will be below that again in FY 2027 and expect it to go down even further from there. This is a big area of focus for us. We are pleased that we were able to get to GAAP profitability now for two consecutive quarters.

I think it will probably go a little bit negative in Q1, where we tend to spend a little bit more money—not on the SBC side, but on the OpEx side—but then we have a path to getting it to positive for the full year.

Jason Celino: Great. Thank you.

Mike Chang: Next question comes from Nick Altman with BTIG, followed by Mark with Loop Capital.

Nick Altman: Awesome. Thank you. You mentioned you doubled the network density, and that is enabling you to detect the asset tags in near real time. Can you talk about how much of an unlock those new real-time detection capabilities could be for both customers who are looking to adopt asset tags or even existing asset tag customers who are potentially looking to expand their footprint? Thank you.

Sanjit Biswas: Yeah. Absolutely. The network density is an interesting one because it lets us increase the frequency and fidelity of the data we are getting back. This is especially helpful in a scenario like loss. A lot of these assets get lost or stolen. They walk away from job sites and so on. Customers are looking to go recover those. They need to know where they are and if they are moving, and so on. It definitely helps there. We also embed this technology in other areas like our worker safety wearable. Even if someone is not near a vehicle, we are able to help keep them safe outside of the cab.

For field services workers, for example, this is a helpful technology. I think it just increases the number of applications we can address—from basic asset tracking to doing much more fine-grained analytics on these assets—because we get much more frequent data updates.

Nick Altman: Okay. Thanks.

Mike Chang: Next question comes from Mark with Loop, followed by Andrew with BNP.

Mark William Schappel: Thanks for taking my question, and congrats on the strong quarter here. Sanjit, typically the start of the year is when software companies will adjust their sales orgs and go-to-market strategies. I was wondering if you are planning any meaningful changes on the sales front in the coming year.

Sanjit Biswas: No. I would say, Mark, we are always looking at efficiencies, trying to make sure we are approaching the market in the best way possible. We are very happy with our structure—nothing significant to report there. I do not know, Dominic, if you want to add anything.

Dominic Phillips: I think more like evolutionary changes. Having more global account specialists for these larger multinationals. We are experimenting and will make more investments in things like product sales specialists to cover all of these emerging products. But nothing hugely structurally different going into FY 2027.

Mark William Schappel: Okay. Great. Thanks.

Mike Chang: Our next question comes from Andrew with BNP, followed by Janae with Truist.

Mike Chang: Andrew? Okay. We will just pass there. Okay. Our last question today comes from Janae with Truist.

Janae: Great. Thank you for taking my question. Given the scale of your network now and with offerings like AI Multicam, 360, real-time weather intelligence, how do you see these capabilities positioning the platform as fleets begin adopting higher levels of autonomy? How should we think about the monetization potential of that proprietary data in an autonomous future context?

Sanjit Biswas: Yeah. From our perspective, autonomy is an exciting technology. It has been on the horizon for some time, and it is starting to come to fruition on the consumer side at least. We view operations as a whole. Autonomy is an “and” for us. We are going to start seeing autonomous vehicles and devices appear in our customers' operations at some point. We do think that they will help expand the number and types of assets and applications we address. You are going to see more workflows and more automation happening where people and these autonomous vehicles are working together.

We do not have plans to take this video data and sell it to the autonomous providers or anything like that. For us, we are really just tracking it as more of a technology.

Janae: Thank you.

Mike Chang: Alright. This concludes the question and answer portion. Thank you all for attending our Q4 fiscal year 2026 earnings call. Before I let you go, I have a few short announcements. We will be attending the Loop Capital Markets Conference on March 10 and the Wells Fargo Symposium on April 8. We will also be hosting the William Blair bus tour on March 16 and the Goldman Sachs bus tour on April 13 in San Francisco. We hope to see you at one of these events. Finally, we are hosting our Investor Day, as Sanjit mentioned, this June in Las Vegas. Please send an email to ir@samsara.com if you are interested in attending in person.

For those who prefer to attend virtually, our IR website will have a link to a live broadcast. That is it for today's meeting. If you have any follow-up questions, you can email us at ir@samsara.com. Bye, everyone.

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