GitLab (GTLB) Stock Drops as Revenue Guidance Disappoints Analysts

TLDR

• GitLab stock dropped ~8% in premarket trading after fiscal 2027 guidance missed analyst estimates
• Projected EPS of 76–80 cents fell well short of the $1.05 analysts expected
• Revenue guidance of $1.10–$1.12 billion came in below the forecasted $1.12 billion
• The Duo Agent Platform is not expected to contribute meaningfully to revenue this year
• At least five brokerages cut their price targets following the earnings report

GitLab stock has now fallen roughly 57% over the past 12 months, and Wednesday’s premarket drop added more pain after the company’s fiscal 2027 outlook landed below what Wall Street was hoping for.

The company posted adjusted earnings of 30 cents per share for its January quarter. Revenue rose 23% year-over-year to $260.4 million, beating the $252.2 million consensus estimate. So the quarter itself wasn’t the problem.

The problem was the outlook.

GitLab Inc., GTLB

GitLab projected fiscal 2027 revenue of $1.10 billion to $1.12 billion. Analysts were looking for $1.12 billion, which would have represented roughly 17% growth. That’s already a step down from the 26% growth the company posted last year.

On the earnings side, the gap was wider. GitLab guided for adjusted EPS of 76 to 80 cents. The Street had pencilled in $1.05. That’s a miss that’s hard to paper over.

At least five brokerages responded by cutting their price targets on the stock.

AI: Friend or Threat?

The central tension here is AI. GitLab’s own Duo Agent Platform is built around the idea of humans and AI agents working side by side. But on the earnings call, management told analysts not to expect the platform to be a meaningful revenue driver in fiscal 2027.

That’s a tough message to deliver at a time when investors are watching every software company closely for signs that AI is helping — not hurting — the business.

TD Cowen analysts flagged the rapidly changing AI landscape as a key watch point. They noted GitLab needs to prove its competitive position in what they called the “AI 2.0 era,” with AI-native tools increasingly entering the developer space.

The broader software sector has been under similar pressure. MongoDB fell 22% on Tuesday after its own soft guidance and comments that AI was not yet a material business driver. GitLab’s results land in that same nervous environment.

Analysts Still See a Path

Not everyone is walking away from the stock. William Blair analyst Jackson Ader kept an Outperform rating, writing that GitLab has a strong enterprise footprint and that AI is expanding the total addressable market over time.

Ader acknowledged that guidance came in short and that management effectively “reset the bar.” But he also pointed to the Q4 results themselves as solid, and said execution on product and go-to-market strategy will be the key test ahead.

GitLab’s stock was down 7.2% in premarket trading on Wednesday, sitting at around $24.35.

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