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.

Samsara said the rapid buildout of AI data centers is driving investment across the physical economy, including power generation, cooling infrastructure and grid upgrades. The company said these trends are creating growing demand for the industries it serves and should continue to support long-term growth.

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