Samsara Says AI Data Center Boom Is Creating Massive Demand Across Physical Economy

Samsara Inc. (NYSE:IOT) stock fell in premarket trading Friday despite the company reporting first-quarter results that topped Wall Street estimates and raising its full-year outlook.

Strong Quarter Driven by Revenue Growth

The connected operations platform company reported adjusted earnings of 17 cents per share, beating analyst estimates of 13 cents. Revenue climbed 31% year over year to $478.8 million, exceeding the consensus estimate of $455.2 million. On a constant-currency basis, revenue increased 29%.

Adjusted operating margin expanded to 19% from 14% a year earlier, driven by improved efficiency across sales and marketing, research and development, and general and administrative expenses.

CEO and Co-founder Sanjit Biswas said Samsara delivered a strong first quarter, with annual recurring revenue nearing $2 billion and the company remaining profitable on a GAAP earnings-per-share basis for a third straight quarter.

He added that growing labor constraints across customers’ operations are creating demand for the company’s AI-powered tools, which are designed to automate tasks, improve productivity, and help physical industries operate more efficiently.

Enterprise Customer Growth Accelerates

Annual recurring revenue (ARR) reached approximately $2 billion, up 30% from a year earlier. Net new ARR totaled $100.7 million, also rising 30%, or 27% on a constant-currency basis.

ARR from customers spending more than $100,000 annually increased 37% to $1.2 billion, marking the third consecutive quarter of accelerating growth. ARR from customers generating more than $1 million annually surged 62%, extending a four-quarter acceleration trend.

Emerging products contributed more than 20% of net new annual contract value for the second straight quarter. Samsara signed 11 new deals worth more than $1 million in net new annual contract value, its second-strongest quarter on record.

The company ended the quarter with 3,363 customers generating more than $100,000 in ARR and 190 customers generating more than $1 million in ARR.

Guidance Raised

Samsara raised its fiscal 2027 adjusted earnings outlook to 70 cents to 72 cents per share from a prior range of 65 cents to 69 cents. The updated forecast exceeds analyst expectations of 68 cents.

The company also increased its fiscal 2027 revenue guidance to $2.005 billion to $2.013 billion, above the Street estimate of $1.971 billion and its previous forecast of $1.965 billion to $1.975 billion.

For the second quarter, Samsara expects adjusted earnings of 15 cents to 16 cents per share on revenue of $482 million to $484 million, both largely in line with or above analyst expectations.

IOT Price Action: Samsara shares were down 2.93% at $34.18 during premarket trading on Friday, according to Benzinga Pro data.

Photo courtesy of Samsara