SailPoint, Inc. Common Stock (SAIL)

“We expect our diluted share count to be approximately 562 million shares and adjusted EPS to be approximately $0.06.”

“We expect adjusted subscription gross profit margin to be approximately 82% due to a higher mix of SaaS revenue versus last Q3, with adjusted operating margin of 16%.”

“On a trailing twelve months basis, our guidance also assumes revenue will cross the $1 billion mark in 2026, with Q3 revenue of $270 million, an increase of 15% year-over-year, making our year-to-date revenue growth rate 23%.”

“For 2026, we expect ARR to cross the $1 billion mark at $1.029 billion, up 26.5% year-over-year.”

“With SailPoint Agent Identity Security, launching at this year's Navigate, we're delivering what we believe is the only solution that is designed to govern AI agents and the sub-agents they create across the full life cycle.”

“We raised ARR by 100 basis points, up from the prior guide, up to 27% year-over-year growth.”

“Additionally, we remain comfortable with the second half consensus estimates for free cash flow of approximately $85 million, with roughly one-third generated in Q3 and two-thirds in Q4.”

“We expect our diluted share count to be approximately 565 million shares and adjusted EPS to be $0.21.”

“We are also increasing our adjusted operating income by $16 million to $179 million or 17% margin compared to our prior guidance of 15.7% margin.”

“For fiscal year 2026, we are increasing our revenue outlook by $16 million to $1.055 billion, up 22.4% year-over-year compared to our prior guidance of 20.6% growth.”

“For our fiscal year 2026, we are increasing our ARR outlook by $10 million to $1.11 billion, up 26.6% year-over-year compared to our prior guidance of 25.5% growth.”

“Our acquisition of key assets from Saviynt, expected to close later this year subject to customary closing conditions, stands to further enhance this offering with what we believe is best-in-class SaaS application visibility and identity risk detection.”

“We expect our diluted share count to be approximately 557 million shares and adjusted EPS to be $0.045.”

“So moving forward, we still are targeting that 90-10 mix, meaning 90% SaaS and 10% term.”

“With our new offering, Agent Identity Security, planned for release this fall, we believe SailPoint is uniquely positioned to govern this new class of digital identities alongside all human and machine identities across the full spectrum of access from the cloud to the mainframe.”

“Specifically for Q1, we foresee an 80-20 mix, based on our pipeline, with the upfront revenue split being about 50-50.”

“We expect a 60-40 mix of upfront versus ratable revenue recognition, which may create some headwinds for revenue and margins throughout the year as we focus on SaaS.”

“We expect our diluted share count to be approximately 564 million shares and adjusted EPS to be a loss of $0.01.”

“Over time, I would expect that I would expect free cash flow margins as we talked about to approach our adjusted operating margin that will happen over the next year or two.”

“We estimate that to be about 200 basis points to 300 basis points for next fiscal year.”

“As we re-enter the public markets for the next year, again, public company costs should be about 50 basis points of a headwind to expansion on that.”

“We expect similar contributions in the coming years, as we still have considerable potential in this area of the business.”

“Looking ahead to FY ’26, we anticipate that SaaS will make up approximately 90% of the net new product annual recurring revenue.”

“We remain confident in our ability to generate high growth rates and increasing profitability over time as we execute on our strategy and complete our revenue model transition.”

“We strongly believe this best positions SailPoint to generate high revenue growth rates, significant margin expansion, and substantial shareholder value over the long term.”

“As a result, we are increasingly confident in our ability to generate strong growth for years to come.”

“We’re going to drop in the single digits as we go into next year.”

“Yes. I think the way to think about it is we had a mid-teens headwind adjusted growth effect in ‘21. And we would expect roughly that sort of effect in ‘22. It will moderate a few percentage points in ‘22 over ‘21, but not significantly.”

“I think as well, we’ve indicated that we see this as ‘22 as a trough year, and we’ll begin to see into ‘23 revenue growth acceleration and correspondingly non-GAAP operating income acceleration, hence, free cash flow acceleration as well.”

“But largely speaking, I think you can anticipate that the free cash flow profile will track non-GAAP operating income.”

“Our expectations remain that 2022 will be a get-off-the-ground year is the way to think about it. We’ll have a good number of opportunities, we believe, to migrate customers to SaaS, but this will be a story that plays out over a multi-year basis.”

“We will respond to demand as it arises, but we do not plan to accelerate our efforts toward maintenance migration in 2022.”

“In line with Matt Hedberg's earlier question, we are investing in this trend and anticipate similar results in 2022 and 2023 as we experienced in 2020 and 2021.”

“As we anticipate revenue growth to accelerate next year, we expect profitability will also improve.”

“Based on this dynamic and the underlying strength of the business, we expect 2022 will be the trough year for revenue growth before accelerating meaningfully in 2023.”

“The first of these transitions is now effectively complete as we expect minimal perpetual license contribution in 2022 and beyond.”

“Second, from a revenue perspective, we expect a similar level of revenue headwind as we experienced in 2021.”

“From a profitability perspective, we anticipate an operating loss of $27 million to $35 million.”

“We expect total revenue of $513 million to $521 million or 17% to 19% growth year-over-year and expect SaaS revenue of $197 million to $201 million or 75% to 78% growth year-over-year.”

“For the full year 2022, we are targeting total ARR of $516 million to $524 million or 39% to 41% growth year-over-year.”

“From a profitability perspective, we anticipate an operating loss of $12 million to $14 million.”

“For total revenue, we expect $110.5 million to $112.5 million or 22% to 24% growth year-over-year.”

“For the first quarter, we expect total ending ARR in the range of $393 million to $395 million or 45% to 46% year-over-year growth.”

“As I highlighted on the last earnings call, we expect to see an increase in migrations of maintenance customers to our SaaS offering over time, which will provide a nice business tailwind in the coming years.”

“We anticipate this mix will continue to increase meaningfully in 2022.”

“Adoption of SaaS identity security solutions is still in an early stage of development, and we expect to have a strong year of new customer growth and expansion within our customer base.”

“We believe this sets us up for many years of exciting growth.”

“I think you can take away from the comments that we made in the prepared remarks that the profile of the business going forward is going to be essentially or effectively a subscription profile.”

“And I expect that will continue going forward into 2022. That's our expectation is that we'll see a moderating contribution from perpetual licenses, but a continued contribution from term licenses.”

“In terms of full year profit, we now anticipate an operating loss of $6.5 million to $8.5 million, roughly in line with our prior guidance.”

“We are raising our full year total revenue outlook to $415.5 million to $417.5 million.”

“In addition to raising our guidance for total ARR, we are also raising our full year outlook for SaaS revenue by $5.5 million to $7.5 million to a range of $110.5 million to $111.5 million, or 65% to 67% growth year-over-year.”

“We anticipate that this could start contributing to our business in 2022, but it will be a gradual, multi-year process.”