Samsara Inc.

Previous wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (1) our audited consolidated financial statements and related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended February 1, 2025 included in our Annual Report on Form 10-K filed with the SEC on March 25, 2025, and (2) our unaudited condensed consolidated financial statements and related notes and other financial information included under Part I, Item 1 of this Quarterly Report on Form 10-Q. Some of the information contained in the following discussion and analysis, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Item 1A. Risk Factors” and “Special Note Regarding Forward-Looking Statements” contained in this Quarterly Report on Form 10-Q and “Risk Factors” included under Part I, Item 1A. of our Annual Report on Form 10-K filed with the SEC on March 25, 2025, as supplemented by our subsequent quarterly reports on Form 10-Q, for a discussion of forward-looking statements and important factors that could impact our business and cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis or implied by past results and trends. These statements, like all statements in this Quarterly Report on Form 10-Q, speak only as of their date (unless another date is indicated), and we undertake no obligation to update or revise these statements in light of future developments. Our fiscal year ends on the Saturday closest to February 1, resulting in a 52-week or 53-week fiscal year. Our fiscal years 2026 and 2025 each consist of 52 weeks, with the fourth quarter consisting of 13 weeks, and our fiscal year 2024 consisted of 53 weeks, with the fourth quarter consisting of 14 weeks.

Current wording

The following discussion and analysis of our financial condition and results of operations should be read in conjunction with (1) our audited consolidated financial statements and related notes and the discussion under the heading “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for the fiscal year ended January 31, 2026 included in our Annual Report on Form 10-K filed with the SEC on March 16, 2026, and (2) our unaudited condensed consolidated financial statements and related notes and other financial information included under Part I, Item 1 of this Quarterly Report on Form 10-Q. Some of the information contained in the following discussion and analysis, including information with respect to our plans and strategy for our business, includes forward-looking statements that involve risks and uncertainties. You should review the sections titled “Item 1A. Risk Factors” and “Special Note Regarding Forward-Looking Statements” contained in this Quarterly Report on Form 10-Q and the section titled “Risk Factors” included under Part I, Item 1A. of our Annual Report on Form 10-K filed with the SEC on March 16, 2026 for a discussion of forward-looking statements and important factors that could impact our business and cause actual results to differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis or implied by past results and trends. These statements, like all statements in this Quarterly Report on Form 10-Q, speak only as of their date (unless another date is indicated), and we undertake no obligation to update or revise these statements in light of future developments. Our fiscal year ends on the Saturday closest to February 1, resulting in a 52-week or 53-week fiscal year. Our fiscal years 2027 and 2026 each consist of 52 weeks.

Previous wording

To realize this vision, we pioneered the Connected Operations Platform, which is an open platform that connects the people, devices, and systems of some of the world’s most complex operations, allowing them to develop actionable insights and improve their operations.

Current wording

To realize this vision, we pioneered the Connected Operations Platform, which is an open platform that connects the people, assets, and systems of some of the world’s most complex operations, allowing them to develop actionable insights and improve their operations.

Previous wording

Our Connected Operations Platform consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights using our cloud dashboard, custom alerts and reports, mobile apps, and workflows. Our differentiated, purpose-built suite of Applications enables organizations to embrace and deploy a digital, cloud-connected strategy across their operations. With Samsara, customers have the ability to drive safer operations, increase business efficiency, and achieve their sustainability goals, all to improve the lives of their employees and the customers they serve.

Current wording

Our Connected Operations Platform consolidates data from our IoT devices and a growing ecosystem of connected assets and third-party systems, and makes it easy for organizations to access, analyze, and act on data insights using our cloud dashboard, custom alerts and reports, mobile apps, and workflows. Powered by our massive and growing data asset and expansive artificial intelligence (“AI”) technology, our differentiated, purpose-built suite of Applications and Agents enables organizations to embrace and deploy a digital, cloud-connected strategy across their operations. With Samsara, customers have the ability to drive safer operations, increase business efficiency, and achieve their sustainability goals, all to improve the lives of their employees and the customers they serve.

Previous wording

We were founded in 2015 and have achieved significant growth since our inception. For the three months ended November 1, 2025 and November 2, 2024, our revenue was $416.0 million and $322.0 million, respectively. Our net income was $7.8 million for the three months ended November 1, 2025, and our net loss was $37.8 million for the three months ended November 2, 2024. For the nine months ended November 1, 2025 and November 2, 2024, our revenue was $1,174.3 million and $902.9 million, respectively. Our net loss was $31.2 million and $143.7 million for the nine months ended November 1, 2025 and November 2, 2024, respectively. Our business model focuses on maximizing the lifetime value of our customer relationships, and we continue to make significant investments to expand our customers’ use of our Connected Operations Platform.

Current wording

We were founded in 2015 and have achieved significant growth since our inception. For the three months ended May 2, 2026 and May 3, 2025, our revenue was $478.8 million and $366.9 million, respectively. Our net income was $44.5 million for the three months ended May 2, 2026 and our net loss was $22.1 million for the three months ended May 3, 2025. Our business model focuses on maximizing the lifetime value of our customer relationships, and we continue to make significant investments to expand our customers’ use of our Connected Operations Platform.

Previous wording

The following table shows a summary of our key business metrics as of the periods presented (dollars in thousands):

Current wording

The following table presents a summary of our key business metrics as of the periods presented (dollars in thousands):

Previous wording

Our performance is driven by continuous innovation on our Connected Operations Platform and our ability to scale our operations to grow our business. We continuously invest in adding new data types to our Connected Operations Platform and innovate with this growing data asset to introduce new Applications over time. Our performance is also impacted by our ability to scale our operations across our business to support our growth. We remain committed to investing in our sales and marketing capacity, investing in world-class talent and productivity tools within our research and development organization, and driving revenue growth globally.

Current wording

Our performance is driven by continuous innovation on our Connected Operations Platform and our ability to scale our operations to grow our business. We continuously invest in adding new data types to our Connected Operations Platform and innovate with this growing data asset to introduce new Applications and Agents over time. Our performance is also impacted by our ability to scale our operations across our business to support our growth. We remain committed to investing in our sales and marketing capacity, investing in world-class talent and productivity tools, and driving revenue growth globally.

Previous wording

Unfavorable conditions in the economy, both in the United States and abroad, may negatively affect the growth of our business and our results of operations. For example, our business and results of operations, as well as those of our customers, could be affected by global macroeconomic trends and events such as inflationary pressure, fluctuations in foreign currency exchange rates, interest rate increases and declines in consumer confidence, widespread disruptions of supply chains and freight and shipping channels, increased prices for many goods and services (including fluctuating hardware component and fuel costs), labor shortages, delayed or reduced spending on technology, and significant volatility and disruption of financial markets, as well as other conditions arising from international conflicts, such as the ongoing conflict between Russia and Ukraine, conflicts in the Middle East, and geopolitical tensions involving China, the outcome of political elections, and new monetary, fiscal, and trade policies (including tariff policies and import and export restrictions) in the United States and abroad. We are continuously monitoring these global events and other macroeconomic developments and how they may impact us directly or indirectly as a result of the effects on our customers and suppliers.

Current wording

Unfavorable conditions in the economy, both in the United States and abroad, may negatively affect the growth of our business and our results of operations. For example, our business and results of operations, as well as those of our customers, could be affected by global macroeconomic trends and events such as inflationary pressure, fluctuations in foreign currency exchange rates, interest rate increases and declines in consumer confidence, widespread disruptions of supply chains and freight and shipping channels, increased prices for many goods and services (including fluctuating hardware component costs, memory, storage and computing costs, and fuel costs), labor shortages, delayed or reduced spending on technology, and significant volatility and disruption of financial markets, as well as other conditions arising from international conflicts and geopolitical tension, the outcome of political elections, and new monetary, fiscal, and trade policies (including tariff policies and import and export restrictions) in the United States and abroad. We are continuously monitoring these global events and other macroeconomic developments and how they may impact us directly or indirectly as a result of the effects on our customers and suppliers.

Previous wording

Refer to the section titled “Item 1A. Risk Factors” and “Special Note Regarding Forward-Looking Statements” contained in this Quarterly Report on Form 10-Q and “Risk Factors” included under Part I, Item 1A and elsewhere in our Annual Report on Form 10-K filed on March 25, 2025, as supplemented by our subsequent quarterly reports on Form 10-Q, for further discussion of the impacts of macroeconomic trends on our business.

Current wording

Refer to the section titled “Risk Factors” in Part II, Item 1A and elsewhere in this Quarterly Report on Form 10-Q and the section titled “Risk Factors” in Part I, Item 1A and elsewhere in our Annual Report on Form 10-K filed on March 16, 2026, for further discussion of the impacts of macroeconomic trends on our business.

Previous wording

We provide access to our Connected Operations Platform through subscription arrangements, whereby the customer is charged a per-subscription fee for access for a specified term. Subscription agreements contain multiple service elements for one or more of our cloud-based Applications via mobile app(s) or a website that enable data collection and provide access to the cellular network, IoT devices (which we also refer to as connected devices), and support services delivered over the term of the arrangement. Our subscription contracts typically have an initial term of three to five years and are generally non-cancelable and non-refundable, subject to limited exceptions under our standard terms of service and other exceptions for public sector customers, who are often subject to annual budget appropriations cycles. Our Connected Operations Platform and IoT devices are highly interdependent and interrelated, and represent a combined performance obligation within the context of the contract.

Current wording

We provide access to our Connected Operations Platform primarily through subscription arrangements, whereby the customer is charged a per-subscription fee for access for a specified term. Subscription agreements contain multiple service elements for one or more of our cloud-based Applications via mobile app(s) or a website that enable data collection and provide access to the cellular network, generally one or more wireless gateways, cameras, sensors and other devices (which we also refer to as connected devices or IoT devices), that are delivered over the term of the arrangement, and warranty coverage. Our subscription contracts typically have an initial term of three to five years and are generally non-cancelable and non-refundable, subject to limited exceptions under our standard terms of service and other exceptions for public sector customers, who are often subject to annual budget appropriations cycles. Our Connected Operations Platform and IoT devices are highly interdependent and interrelated, and represent a combined performance obligation within the context of the contract.

Previous wording

Cost of revenue consists primarily of the amortization of connected device costs associated with subscription agreements, third-party cloud and cellular costs, employee-related costs directly associated with our customer support and operations, including salaries, benefits and stock-based compensation, amortization of internal-use software costs, fulfillment costs, warranty costs, write-downs of excess and obsolete inventory, and costs associated with software subscriptions and office facilities.

Current wording

Cost of revenue consists primarily of the amortization of connected device costs associated with subscription agreements, third-party cloud and cellular costs, employee-related costs directly associated with our customer support and supply chain teams, including salaries, benefits, and stock-based compensation, amortization of internal-use software costs, fulfillment costs, warranty costs, provision for excess and obsolete inventory, and costs associated with software subscriptions and office facilities.

Previous wording

As our customers expand and increase the use of our Connected Operations Platform driven by additional IoT devices and Applications, our cost of revenue may vary from quarter to quarter as a percentage of our revenue due to the timing and extent of these expenses. We intend to continue to invest additional resources in our Connected Operations Platform and customer support and operations as we grow our business. The level and timing of investment in these areas will affect our cost of revenue in the future.

Current wording

As our customers expand and increase the use of our Connected Operations Platform driven by additional IoT devices and Applications, our cost of revenue may vary from quarter to quarter as a percentage of our revenue due to the timing and extent of these expenses. We intend to continue to invest additional resources in our Connected Operations Platform, including in our IoT device hardware, cloud infrastructure, and cellular connectivity, as well as in customer support and operations as we grow our business. The level and timing of investment in these areas will affect our cost of revenue in the future.

Previous wording

Research and development expenses consist primarily of employee-related costs, including salaries, benefits and stock-based compensation, associated with improvements to our platform and the development of new product offerings, expenses directly related to the development of our products, and costs associated with software subscriptions and office facilities. We continue to focus our research and development efforts on adding new features and products and enhancing the utility of our Connected Operations Platform.

Current wording

Research and development expenses consist primarily of employee-related costs, including salaries, benefits, and stock-based compensation, associated with improvements to our platform and current offerings and the development of new products, and costs associated with software subscriptions and office facilities. We continue to focus our research and development efforts on adding new features and products and enhancing the utility of our Connected Operations Platform.

Previous wording

General and administrative expenses consist primarily of employee-related costs for executive, finance, legal, human resources, facilities, and certain IT personnel, including salaries, benefits and stock-based compensation. General and administrative expenses also include costs related to fees paid for professional services, including legal, accounting, recruiting and other consulting services, as well as costs associated with software subscriptions and office facilities.

Current wording

General and administrative expenses consist primarily of employee-related costs for executive, finance, legal, human resources, facilities, and certain IT personnel, including salaries, benefits, and stock-based compensation. General and administrative expenses also include costs related to professional services, including legal, accounting, recruiting and other consulting services, as well as costs associated with software subscriptions and office facilities.

Previous wording

Interest income and other income, net, consists primarily of income earned on our money market funds and marketable debt securities, including amortization of premiums and accretion of discounts. It also includes the effect of changes in foreign currency exchange rates. As we have expanded our global operations, our exposure to fluctuations in foreign currencies has increased, and we expect this to continue.

Current wording

Interest income and other income, net, consists primarily of income earned on our money market funds and marketable debt securities, including amortization of premiums and accretion of discounts, and net unrealized gains (losses) on our strategic investments. It also includes one-time gains and losses not associated with our core operations and the effect of changes in foreign currency exchange rates. As we have expanded our global operations, our exposure to fluctuations in foreign currencies has increased, and we expect this to continue.

Previous wording

Comparison of the Three and Nine Months Ended November 1, 2025 and November 2, 2024

Current wording

Comparison of the Three Months Ended May 2, 2026 and May 3, 2025

Previous wording

Revenue increased by $94.0 million and $271.4 million, or 29% and 30%, for the three and nine months ended November 1, 2025, respectively, compared to the three and nine months ended November 2, 2024, primarily due to an increase in new customers and increased purchases of subscriptions to our Connected Operations Platform, including subscriptions to additional Applications, by existing customers.

Current wording

Revenue increased by $112.0 million, or 31%, for the three months ended May 2, 2026 compared to the three months ended May 3, 2025, primarily due to an increase in new customers and increased purchases by existing customers.

Previous wording

Cost of revenue increased by $20.9 million, or 28%, for the three months ended November 1, 2025 compared to the three months ended November 2, 2024, primarily due to $9.7 million of increased cloud and cellular costs associated with our product offerings and $7.4 million of increased connected device costs. The increases in cloud and cellular costs and connected device costs were primarily due to increased sales volume year-over-year.

Current wording

Cost of revenue increased by $34.5 million, or 42%, for the three months ended May 2, 2026 compared to the three months ended May 3, 2025, primarily due to $16.1 million of increased cloud and cellular costs, $10.8 million of increased connected device costs, and $3.0 million of increased employee-related costs. The increases in cloud and cellular costs and connected device costs were primarily due to increased sales volume and additional product features and functionality year-over-year. The increase in employee-related costs was primarily due to increased headcount.

Previous wording

Our gross margin increased to 77% for the three months ended November 1, 2025 compared to 76% for the three months ended November 2, 2024, mainly due to operational efficiencies in direct labor costs and connected device costs.

Current wording

Our gross margin decreased to 75% for the three months ended May 2, 2026 compared to 77% for the three months ended May 3, 2025, mainly due to increased cloud and cellular costs.

Previous wording

Research and development expense increased by $9.2 million, or 12%, for the three months ended November 1, 2025 compared to the three months ended November 2, 2024, primarily due to a $4.6 million increase in employee-related costs, which included a $4.0 million increase in stock-based compensation expense and a $0.6 million increase in salaries and benefits and related employer taxes, primarily due to increased headcount. The increase in research and development expense was also due to a $2.0 million increase in cloud and cellular costs associated with product development and a $1.6 million increase in costs associated with software subscriptions and office facilities.

Current wording

Research and development expense increased by $14.3 million, or 17%, for the three months ended May 2, 2026 compared to the three months ended May 3, 2025, primarily due to a $5.9 million increase in costs associated with software subscriptions, a $4.6 million increase in cloud and cellular costs driven by investments in AI tooling and related development infrastructure, and a $3.9 million increase in employee-related costs.

Previous wording

Sales and marketing expense increased by $58.9 million, or 13%, for the nine months ended November 1, 2025 compared to the nine months ended November 2, 2024, primarily due to a $46.8 million increase in employee-related costs, which included a $27.6 million increase in salaries and benefits and related employer taxes, a $13.2 million increase in sales commissions, and a $6.0 million increase in stock-based compensation expense, primarily due to increased headcount. The increase in sales and marketing expense was also due to a $8.9 million increase in expenditures incurred to generate demand through various marketing channels and promotional events, including our annual conference.

Current wording

Sales and marketing expense increased by $38.2 million, or 23%, for the three months ended May 2, 2026 compared to the three months ended May 3, 2025, primarily due to a $23.5 million increase in employee-related costs, which included a $18.1 million increase in salaries, benefits, and related employer taxes primarily due to increased headcount and a $5.8 million increase in sales commissions. The increase in sales and marketing expense was also due to a $9.7 million increase in expenditures incurred to generate demand through various marketing channels and promotional events.

Previous wording

The provision for income taxes increased by $0.8 million and $2.6 million, or 170% and 137%, for the three and nine months ended November 1, 2025, respectively, compared to the three and nine months ended November 2, 2024, primarily due to the growth of our operations in foreign jurisdictions.

Current wording

The provision for income taxes increased by $2.8 million, or 178%, for the three months ended May 2, 2026 compared to the three months ended May 3, 2025, primarily due to growth in our operations in foreign jurisdictions.

Previous wording

Stock-based compensation expense-related charges include the amortization of deferred stock-based compensation expense for capitalized software and cloud computing arrangements and employer taxes on employee equity transactions. Stock-based compensation expense is a non-cash expense and is dependent on our stock price, which is beyond our control. Accordingly, we find it useful to exclude stock-based compensation expense in order to better understand our ongoing operational performance. Employer taxes on employee equity transactions, which are a cash expense, are excluded because such taxes are directly tied to the timing and size of employee equity transactions and the future fair market value of our common stock, which may vary from period to period independent of the operating performance of our business.

Current wording

Stock-based compensation expense-related charges include the amortization of deferred stock-based compensation expense for internal-use software and cloud computing arrangements and employer taxes on employee equity transactions. Stock-based compensation expense is a non-cash expense and is dependent on our stock price, which is beyond our control. Accordingly, we find it useful to exclude stock-based compensation expense in order to better understand our ongoing operational performance. Employer taxes on employee equity transactions, which are cash expenses, are excluded because such taxes are directly tied to the timing and size of employee equity transactions and the future fair market value of our common stock, which may vary from period to period independent of the operating performance of our business.

Previous wording

Lease modification, impairment, and related charges, and legal settlements are excluded because management believes that such charges are not reflective of our ongoing operational performance.

Current wording

Lease modification, impairment, and related charges, and legal settlements and awards are excluded because management believes that such charges are not reflective of our ongoing operational performance.

Previous wording

(1)Stock-based compensation expense-related charges included approximately $0.2 million and $0.3 million of employer taxes on employee equity transactions for the three months ended November 1, 2025 and November 2, 2024, respectively.

Current wording

(1)Stock-based compensation expense-related charges included approximately $0.3 million and $0.4 million of employer taxes on employee equity transactions for the three months ended May 2, 2026 and May 3, 2025, respectively.

Previous wording

Non-GAAP Operating Income (Loss) and Non-GAAP Operating Margin

Current wording

Non-GAAP Operating Income and Non-GAAP Operating Margin

Previous wording

We define non-GAAP operating income (loss) as operating income (loss) excluding the effect of stock-based compensation expense-related charges, lease modification, impairment, and related charges, and legal settlements. Non-GAAP operating margin is defined as non-GAAP operating income (loss) as a percentage of total revenue. We use non-GAAP operating income (loss) and non-GAAP operating margin in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP operating income (loss) and non-GAAP operating margin provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP operating income to our GAAP loss from operations for the periods presented (in thousands, except percentages):

Current wording

We define non-GAAP operating income as income (loss) from operations excluding the effect of stock-based compensation expense-related charges, lease modification, impairment, and related charges, and legal settlements. Non-GAAP operating margin is defined as non-GAAP operating income as a percentage of total revenue. We use non-GAAP operating income and non-GAAP operating margin in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP operating income and non-GAAP operating margin provide our management and investors consistency and comparability with our past financial performance and facilitate period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP operating income to our GAAP income (loss) from operations for the periods presented (in thousands, except percentages):

Previous wording

(1)Stock-based compensation expense-related charges included approximately $2.7 million and $4.5 million of employer taxes on employee equity transactions for the three months ended November 1, 2025 and November 2, 2024, respectively.

Current wording

(1)Stock-based compensation expense-related charges included approximately $5.0 million and $6.5 million of employer taxes on employee equity transactions for the three months ended May 2, 2026 and May 3, 2025, respectively.

Previous wording

We define non-GAAP net income (loss) as net income (loss) excluding the effect of stock-based compensation expense-related charges, lease modification, impairment, and related charges, and legal settlements. We use non-GAAP net income (loss) in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP net income (loss) provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP net income to our GAAP net income (loss) for the periods presented (in thousands, except percentages):

Current wording

We define non-GAAP net income asnet income (loss) excluding the effect of stock-based compensation expense-related charges, lease modification, impairment, and related charges, and legal settlements and awards. We use non-GAAP net income in conjunction with traditional GAAP measures to evaluate our financial performance. We believe that non-GAAP net income provides our management and investors consistency and comparability with our past financial performance and facilitates period-to-period comparisons of operations. The following table presents a reconciliation of our non-GAAP net income to our GAAPnet income (loss) for the periods presented (in thousands, except percentages):

Previous wording

(1)There were no material income tax effects on our non-GAAP adjustments for all periods presented.

Current wording

(2)There were no material income tax effects on our non-GAAP adjustments for all periods presented.

Previous wording

We define free cash flow as net cash provided by (used in) operating activities reduced by cash used for purchases of property and equipment. Free cash flow margin is calculated as free cash flow as a percentage of total revenue. We believe that free cash flow and free cash flow margin, even if negative, are useful in evaluating liquidity and provide information to management and investors about our ability to fund future operating needs and strategic initiatives. The following table presents a reconciliation of free cash flow to net cash provided by operating activities for the periods presented (in thousands, except percentages):

Current wording

We define free cash flow as net cash provided by operating activities reduced by cash used for purchases of property and equipment. Free cash flow margin is calculated as free cash flow as a percentage of total revenue. We believe that free cash flow and free cash flow margin, even if negative, are useful in evaluating liquidity and provide information to management and investors about our ability to fund future operating needs and strategic initiatives. The following table presents a reconciliation of free cash flow to net cash provided by operating activities for the periods presented (in thousands, except percentages):

Previous wording

Since our founding, we have financed our operations primarily through the sale of equity securities and payments received from our customers. In December 2021, we completed our initial public offering (“IPO”), which resulted in aggregate net proceeds of $846.7 million, including proceeds from the underwriters’ exercise of their option to purchase additional shares of our Class A common stock in January 2022 and net of underwriting discounts and commissions. We have generated significant operating losses from our operations, as reflected in our accumulated deficit of $1,641.2 million as of November 1, 2025. We intend to continue investing in our business, and as a result, we may require additional capital resources to execute on our strategic initiatives to grow our business, particularly if we generate negative cash flows in future quarters. We believe that our existing cash, cash equivalents, and short-term and long-term investments will be sufficient to support working capital, including our non-cancelable arrangements, and capital expenditure requirements for at least the next 12 months.

Current wording

Since our founding, we have financed our operations primarily through the sale of equity securities and payments received from our customers. In December 2021, we completed our initial public offering (“IPO”), which resulted in aggregate net proceeds of $846.7 million, including proceeds from the underwriters’ exercise of their option to purchase additional shares of our Class A common stock in January 2022 and net of underwriting discounts and commissions. We have generated significant operating losses from our operations, as reflected in our accumulated deficit of $1,574.6 million as of May 2, 2026. We intend to continue investing in our business, and as a result, we may require additional capital resources to execute on our strategic initiatives to grow our business, particularly if we generate negative cash flows in future quarters. We believe that our existing cash, cash equivalents, and short-term and long-term investments will be sufficient to support working capital, including our non-cancelable arrangements, and capital expenditure requirements for at least the next 12 months.

Previous wording

As of November 1, 2025, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments of $1,147.2 million. Cash and cash equivalents consisted of cash as well as highly liquid investments with an original maturity of 90 days or less, when purchased. Our investments primarily consisted of U.S. government and agency securities, corporate notes and bonds, and commercial paper. Our primary uses of cash include employee-related expenditures, third-party cloud and cellular costs, sales and marketing expenses, overhead expenses, and funding other working capital requirements, such as inventory and related connected device costs to meet our performance obligations related to our Connected Operations Platform.

Current wording

As of May 2, 2026, our principal sources of liquidity were cash, cash equivalents, and short-term and long-term investments of $1,281.4 million. Cash and cash equivalents consisted of cash as well as highly liquid investments with an original maturity of 90 days or less, when purchased. Our investments primarily consisted of U.S. government, and agency securities, and municipal securities, corporate notes and bonds, and commercial paper. Our primary uses of cash include employee-related expenditures, third-party cloud and cellular costs, sales and marketing expenses, overhead expenses, and funding other working capital requirements, such as inventory and related connected device costs to meet our performance obligations related to our Connected Operations Platform.

Previous wording

The following table shows a summary of our cash flows for the periods presented (in thousands):

Current wording

The following table presents a summary of our cash flows for the periods presented (in thousands):

Previous wording

Our largest source of operating cash is payments received from our customers. Our primary uses of cash from operating activities are for employee-related expenditures, sales and marketing expenses, inventory and related connected device costs, third-party cloud and cellular costs, and overhead expenses. Although we generated positive operating cash flows beginning in fiscal year 2025, we generated negative cash flows from operations in the preceding two fiscal years. We have supplemented working capital through net proceeds from the sale of equity securities.

Current wording

Our largest source of operating cash is payments received from our customers. Our primary uses of cash from operating activities are for employee-related expenditures, third-party cloud and cellular costs, sales and marketing expenses, general and administrative costs, and purchases of inventory and connected device costs. We have supplemented working capital through net proceeds from the sale of equity securities.

Previous wording

Cash provided by operating activities mainly consists of our net loss adjusted for certain non-cash items, including stock-based compensation, depreciation and amortization of property and equipment, net accretion of discounts on marketable debt securities, and non-cash operating lease costs, and changes in operating assets and liabilities during each period.

Current wording

Cash provided by operating activities mainly consists of ournet income (loss) adjusted for certain non-cash items, including stock-based compensation, depreciation and amortization of property and equipment, and net accretion of discounts on marketable debt securities, and changes in operating assets and liabilities during each period.

Previous wording

Cash provided by operating activities was $166.5 million for the nine months ended November 1, 2025. This consisted of a net loss of $31.2 million, adjusted for non-cash charges of $248.6 million, and changes in our operating assets and liabilities of $51.0 million. The non-cash charges were primarily composed of stock-based compensation expense of $236.1 million and depreciation and amortization of $16.6 million. Changes in our operating assets and liabilities during the nine months ended November 1, 2025 reflect an increase in accounts receivable from customers, connected device costs, and deferred commissions due to the growth of our business, an increase in inventory levels to meet anticipated demand requirements, partially offset by increases in deferred revenue due to the growth of our business during the nine months ended November 1, 2025.

Current wording

Cash provided by operating activities was $81.4 million for the three months ended May 2, 2026. This consisted of anet income of $44.5 million, adjusted for non-cash charges of $83.1 million, partially offset by net uses of cash from changes in our operating assets and liabilities of $46.2 million. The non-cash charges were primarily composed of stock-based compensation expense of $77.5 million and depreciation and amortization of $7.9 million. Changes in our operating assets and liabilities during the three months ended May 2, 2026 reflect the recognition of an arbitration award receivable, higher vendor payments, higher connected device costs and deferred commissions due to the growth of our business, and increases in inventory levels to meet anticipated demand requirements, partially offset by higher cash collections from customers and increases in deferred revenue due to the growth of our business during the three months ended May 2, 2026.

Previous wording

Cash provided by operating activities was$77.8 million for thenine months ended November 2, 2024. This consisted of a net loss of$143.7 million, adjusted for non-cash charges of$220.1 million, and changes in our operating assets and liabilities of$1.4 million. The non-cash charges were primarily composed of stock-based compensation expense of$208.9 million, depreciation and amortization of$15.8 million, and lease modification, impairment, and related charges of$3.6 million, partially offset by net accretion of discounts on marketable debt securities of$12.2 million. Changes in our operating assets and liabilities during thenine months ended November 2, 2024 reflect increases in deferred revenue due to the growth of our business and lower prepaid expenses and other current assets, partially offset by increased accounts receivable from customers, higher levels of inventories to meet anticipated demand requirements, higher deferred commissions, higher connected device costs, and higher vendor payments during the nine months ended November 2, 2024.

Current wording

Cash provided by operating activities was$52.6 million for thethree months ended May 3, 2025. This consisted of anet loss of$22.1 million, adjusted for non-cash charges of$79.3 million, and changes in our operating assets and liabilities of$4.6 million. The non-cash charges were primarily composed of stock-based compensation expense of$77.1 million and depreciation and amortization of$5.1 million, partially offset by net accretion of discounts on marketable debt securities of$2.6 million. Changes in our operating assets and liabilities during thethree months ended May 3, 2025 reflect higher vendor payments and higher deferred commissions and connected device costs due to the growth of our business, partially offset by increases in deferred revenue also due to the growth of our business and higher cash collections from customers during the three months ended May 3, 2025.

Previous wording

Cash used in investing activities was $134.7 million for the nine months ended November 1, 2025, which primarily consisted of $643.1 million of purchases of investments and $20.7 million of capital expenditures for internal-use software costs and our office facilities, partially offset by $530.4 million of proceeds from maturities and redemptions of investments.

Current wording

Cash used in investing activities was $149.2 million for the three months ended May 2, 2026, which primarily consisted of $357.5 million of purchases of investments and $6.2 million of capitalized internal-use software costs, partially offset by $216.6 million of proceeds from maturities and redemptions of investments.

Previous wording

Cash used in investing activities was$67.1 million for thenine months ended November 2, 2024, which primarily consisted of$526.1 million of purchases of investments and$14.8 million of capital expenditures for internal-use software costs and our office facilities, partially offset by$472.8 million of proceeds from maturities and redemptions of investments and$1.2 million of proceeds from sales of investments.

Current wording

Cash used in investing activities was$18.3 million for thethree months ended May 3, 2025, which primarily consisted of$173.1 million of purchases of investments and $5.1 million of capitalized internal-use software costs, partially offset by$162.0 million of proceeds from maturities and redemptions of investments.

Previous wording

There were no material changes to our critical accounting estimates during the nine months ended November 1, 2025.

Current wording

There were no material changes to our critical accounting estimates during the three months ended May 2, 2026.