Asana Q2 Revenue Up on AI Studio Surge

Asana(NYSE:ASAN) reported fiscal second quarter 2026 results (period ended July 31, 2025) on September 3, 2025, posting GAAP revenue of $196.9 million (up 10% year over year), a non-GAAP operating margin of 7%, and a dollar-based net retention rate (NRR) of 96%. The company highlighted rapid AI Studio adoption, international momentum, and significant margin expansion, while management raised the low end of full-year fiscal 2026 revenue guidance to $780 million to $790 million. The following insights detail the most impactful strategic and financial developments from the call.

AI Studio adoption drives Asana’s multiproduct expansion

Quarterly annual recurring revenue (ARR) from AI Studio, Asana’s no-code AI workflow platform, more than doubled sequentially, with customer case studies including Morningstar (saving nearly 15,000 person-hours annually), a global chemicals company expanding from 2,500 to 4,500 users, and a leading AI foundation model provider nearly doubling its footprint. The number of $100,000-plus customers grew 19% year over year, and non-tech verticals continued to grow in the mid-teens.

"We continue to see strong momentum in AI Studio. We've more than doubled our AI Studio ARR quarter over quarter. And adoption continues to strengthen as customers build and scale on the platform."
-- Dan Rogers, CEO

AI Studio’s rapid adoption and integration into both self-serve and enterprise accounts positions Asana to deepen customer relationships, increase expansion opportunities, and support a long-term shift to a multiproduct model that enhances platform stickiness and revenue durability.

Asana margin expansion reflects disciplined cost management

Non-GAAP operating margin expanded nearly 1,600 basis points year over year to 7%, with research and development (R&D) expenses down 16% year over year and sales and marketing expenses down 3% year over year. Gross margin held steady at 90%, and adjusted free cash flow reached $35.4 million, or 18% on a margin basis.

"As a result of driving productivity and efficiency gains, we delivered a 7% operating margin, or $14 million of operating income in the quarter. Which represents 240 basis points above the midpoint of our operating margin guide. And an almost 1,600 basis point improvement year over year."
-- Sonalee Parekh, CFO

Asana’s ability to expand margins while maintaining strong gross margins and positive free cash flow demonstrates effective cost optimization and provides a foundation for sustained profitability and future investment flexibility.

International and non-tech growth outpace U.S. and tech verticals

International revenue grew 13% year over year, outpacing U.S. growth of 8% year over year, with Japan highlighted as a high-growth region where Sumitomo Mitsui Trust Bank expanded its platform usage by nearly 70%. Non-tech verticals continued to grow in the mid-teens, while technology customer growth remained stable.

"International markets remain a strength for our business driven by growing global demand for our platform. Especially in EMEA and Japan. Our international revenue grew 13% year over year, and the U.S. market grew 8% year over year."
-- Anne Raimondi, COO

This geographic and sector diversification enhances Asana’s resilience, reduces reliance on the technology sector, and positions the company to capture structural tailwinds in new markets and industries.

Looking Ahead

Management raised the low end of full-year fiscal 2026 GAAP revenue guidance to $780 million to $790 million (up 8%-9% year over year) and expects full-year non-GAAP operating income of $46 million to $50 million (6% margin, up from prior 5.5% guidance). Third-quarter revenue is guided to $197.5 million to $199.5 million, with a non-GAAP operating margin of 6%-7%. While improvements in logo churn and expansion were noted, guidance reflects ongoing caution around small and medium-sized business (SMB) search traffic headwinds and concentrated technology renewals; management anticipates AI Studio will have a more meaningful impact in fiscal 2027.

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This article was created using Large Language Models (LLMs) based on The Motley Fool's insights and investing approach. It has been reviewed by our AI quality control systems. Since LLMs cannot (currently) own stocks, it has no positions in any of the stocks mentioned. The Motley Fool recommends Asana. The Motley Fool has a disclosure policy.