Sprinklr Surges After Q3 Earnings Beat and Raised Outlook
The customer experience software firm surpassed Wall Street estimates for profit and revenue, signaling strong enterprise demand and boosting its full-year forecast.
Shares of Sprinklr (NYSE: CXM) jumped on Wednesday after the enterprise software company posted third-quarter financial results that exceeded analyst expectations and raised its revenue guidance for the full fiscal year, suggesting robust momentum despite a cautious pre-earnings sentiment on Wall Street.
The New York-based customer experience management firm saw its stock climb by as much as 3.7% to $7.54 in morning trading. The positive market reaction followed the release of a strong quarterly report that eased investor concerns about spending in the software sector.
For the third quarter of fiscal 2026, Sprinklr reported non-GAAP earnings of $0.12 per share, comfortably beating the consensus estimate of $0.09 per share. Revenue for the quarter reached $219.1 million, a 9% increase year-over-year and ahead of the $209.56 million anticipated by analysts. A significant portion of this came from subscription revenue, which grew 5% to $190.3 million, indicating steady demand for its core platform.
Defying Cautious Expectations
The strong performance offers a sharp contrast to the more reserved analyst outlook preceding the announcement. Before the release, Wall Street held a consensus "Hold" rating on Sprinklr, with firms like Barclays maintaining an "underweight" rating and an $8.00 price target. The results delivered a decisive upside surprise, challenging the narrative of slowing growth.
Buoyed by the quarterly success, Sprinklr's management issued an optimistic forecast for the remainder of the fiscal year. The company raised its full-year 2026 revenue guidance to a range of $853 million to $854 million, surpassing the prior Wall Street consensus of $838 million. Sprinklr also projected full-year earnings to land between $0.43 and $0.44 per share, aligning with analyst estimates and reinforcing confidence in its operational efficiency.
Strategic Focus on AI and Enterprise Clients
Sprinklr provides a unified cloud-based platform that uses artificial intelligence to help global brands manage marketing, advertising, and customer support across dozens of digital channels. The better-than-expected results suggest that enterprise clients are continuing to invest in technology that can streamline customer interactions and provide actionable data insights, even amid broader economic uncertainty.
Investors had been closely watching the company's ability to balance investments in advanced AI features with the associated costs of cloud services and large language models (LLMs). The third-quarter performance indicates that Sprinklr is successfully navigating this challenge, expanding its AI capabilities without severely impacting profitability. The company's ability to grow its subscription base is a key metric of its long-term health, and the latest figures provide a positive signal.
Prior to the report, the stock was trading below its 50-day and 200-day moving averages of $7.56 and $8.15, respectively. Wednesday's surge brings the price closer to these key technical levels, and sustained momentum could shift the stock's trajectory as investors digest the strong fundamental performance.
As analysts update their models in the coming days, the focus will likely be on the durability of this renewed growth and the company's margin profile. The raised guidance provides a strong foundation for a more bullish outlook, but the market will be looking for continued execution in the final quarter of the year to confirm the positive trend.