Yext (YEXT) Q2 2027 Financial Results Summary
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Yext (YEXT) Q2 2027: Revenue Decline, Profitability Improvement — Cautiously Optimistic
Yext, Inc. (NYSE: YEXT) reported its second quarter results for fiscal year 2027, revealing a revenue of $111.1 million, which represents a decline of $1.0 million or -0.9% compared to the same quarter last year, where revenue was $113.1 million. Despite the revenue drop, the company demonstrated improved profitability metrics, which could be a positive sign for shareholders.
Key Financial Metrics:
- Revenue: $111.1 million (down $1.0 million or -0.9% YoY)
- Net Income Per Share (GAAP): $0.13 (down from $0.22 YoY)
- Non-GAAP Net Income Per Share: $0.21 (up from $0.13 YoY)
- Adjusted EBITDA: $34.0 million (up from $26.3 million YoY)
- Adjusted EBITDA Margin: 31% (up from 23.3% YoY)
- Annual Recurring Revenue (ARR): $440.8 million (down from $444.3 million YoY)
Analyst Opinion
This quarter presents a mixed bag for shareholders. While the revenue decline is disappointing, the significant improvement in profitability metrics, particularly the increase in Adjusted EBITDA and non-GAAP net income per share, indicates that Yext is managing its costs effectively. The company’s ability to maintain a strong Adjusted EBITDA margin of 31% suggests operational efficiency, which is crucial in a competitive landscape. However, the slight decrease in ARR and revenue raises concerns about growth momentum.
Shareholder Returns and Future Outlook
Yext has not announced any changes to its dividend or share buyback programs in this quarter. The focus appears to be on strategic growth initiatives, including the recent acquisition of GoShine, which aims to enhance brand-level visibility optimization for AI search. Additionally, the release of the working prototype of Corvo AI is a forward-looking initiative that could drive future growth.
Forward Catalyst
Investors should closely monitor Yext's performance in the upcoming quarter, particularly the impact of its new product offerings and the integration of GoShine. The company’s guidance for the third quarter will be critical, especially in light of the current economic conditions and competitive pressures. Furthermore, tracking the dollar-based net retention rate, which stands at 96% for total customers, will provide insights into customer satisfaction and expansion potential.
In summary, while Yext's revenue decline is a concern, the improvements in profitability and strategic initiatives suggest a cautiously optimistic outlook for the company moving forward.
Consolidated Statements of Operations and Comprehensive Income
In thousands, except share and per share data
Note: The amounts in the following table are in thousands.
| Three months ended | July 31, 2026 | July 31, 2025 | Six months ended | July 31, 2026 | July 31, 2025 |
|---|---|---|---|---|---|
| Revenue | 111,103 | 113,094 | Revenue | 219,019 | 222,577 |
| Cost of revenue | 27,267 | 28,060 | Cost of revenue | 56,462 | 55,165 |
| Gross profit | 83,836 | 85,034 | Gross profit | 162,557 | 167,412 |
| Operating expenses | Operating expenses | ||||
| Sales and marketing | 26,309 | 32,069 | Sales and marketing | 55,706 | 68,278 |
| Research and development | 19,373 | 23,352 | Research and development | 40,854 | 45,248 |
| General and administrative | 20,592 | -61 | General and administrative | 42,854 | 23,094 |
| Total operating expenses | 66,274 | 55,360 | Total operating expenses | 139,414 | 136,620 |
| Income from operations | 17,562 | 29,674 | Income from operations | 23,143 | 30,792 |
| Interest income | 437 | 1,179 | Interest income | 1,180 | 1,811 |
| Interest expense | -3,565 | -2,277 | Interest expense | -6,667 | -2,919 |
| Other expense, net | -230 | -45 | Other expense, net | -395 | -400 |
| Income from operations before income taxes | 14,204 | 28,531 | Income from operations before income taxes | 17,261 | 29,284 |
| Provision for income taxes | -1,055 | -1,780 | Provision for income taxes | -1,487 | -1,763 |
| Net income | 13,149 | 26,751 | Net income | 15,774 | 27,521 |
| Net income per share attributable to common stock, basic | 0.13 | 0.22 | Net income per share attributable to common stock, basic | 0.15 | 0.22 |
| Net income per share attributable to common stock, diluted | 0.13 | 0.03 | Net income per share attributable to common stock, diluted | 0.15 | 0.05 |
| Weighted-average shares used to compute net income per share, basic | 100,09... | 122,85... | Weighted-average shares used to compute net income per share, basic | 105,81... | 124,229... |
| Weighted-average shares used to compute net income per share, diluted | 103,11... | 130,80... | Weighted-average shares used to compute net income per share, diluted | 107,16... | 131,013... |
| Other comprehensive (loss) income | -374 | 21 | Other comprehensive (loss) income | -825 | 3,304 |
| Unrealized (loss) gain on marketable securities, net | — | -9 | Unrealized (loss) gain on marketable securities, net | 9 | -9 |
| Total comprehensive income | 12,775 | 26,763 | Total comprehensive income | 14,958 | 30,816 |
Consolidated Balance Sheets
In thousands, except share and per share data
Note: The amounts in the following table are in thousands.
| July 31, 2026 | January 31, 2026 | |
|---|---|---|
| Assets | ||
| Current assets: | ||
| Cash and cash equivalents | 86,828 | 154,123 |
| Restricted cash, current | — | 1,500 |
| Accounts receivable, net of allowances | 68,797 | 120,637 |
| Prepaid expenses and other current assets | 26,071 | 21,253 |
| Costs to obtain revenue contracts, current | 16,917 | 20,291 |
| Total current assets | 198,613 | 317,804 |
| Property and equipment, net | 25,992 | 30,088 |
| Operating lease right-of-use assets | 43,987 | 50,908 |
| Restricted cash, non-current | 13,541 | 13,551 |
| Costs to obtain revenue contracts, non-current | 9,343 | 10,663 |
| Goodwill | 111,235 | 110,801 |
| Intangible assets, net | 77,647 | 85,133 |
| Other long term assets | 3,589 | 2,828 |
| Total assets | 483,947 | 621,776 |
| Liabilities and stockholders’ equity | ||
| Current liabilities: | ||
| Accounts payable, accrued expenses and other current liabilities | 34,614 | 52,528 |
| Unearned revenue, current | 179,594 | 217,465 |
| Operating lease liabilities, current | 18,950 |
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