SentinelOne announced a restructuring plan cutting approximately 8% of its full-time workforce on Wednesday, as the cybersecurity company reported first-quarter revenue that fell short of expectations and issued guidance that disappointed investors.
SentinelOne stock fell roughly 12%, according to CNBC, after the results were released. The company reported adjusted revenue of $276.7 million for the quarter ended April 30. Analysts had expected $277.38 million, according to Yahoo Finance. Adjusted earnings came in at $0.04 per share, ahead of the $0.02 per share analysts had anticipated.
According to the company, the restructuring is aimed at sharpening focus on AI, data, cloud, and endpoint security while streamlining operations. The associated costs are estimated at around $25 million in total, with cash outlays accounting for roughly $15 million of that figure, the company said. SentinelOne said it anticipates wrapping up the bulk of the restructuring work by the end of its fiscal second quarter of 2027.
“This is not a reactive measure, it is a deliberate evolution to reduce complexity, raise the performance bar, and build a leaner, more agile SentinelOne,” CEO Tomer Weingarten told CNBC on the earnings call. The company had more than 3,000 employees at the end of April, according to CNBC.
SentinelOne’s second-quarter guidance also weighed on investor sentiment. For the current quarter, SentinelOne set a revenue target in the range of $289 million to $291 million, falling short of the roughly $292 million that analysts had projected, according to CNBC.
Full-year guidance for fiscal 2027 was left unchanged, with the company holding to a revenue range of $1.195 billion to $1.205 billion and an adjusted earnings outlook of $0.32 to $0.38 per share, the company said.
Despite the stock decline, several underlying metrics showed continued momentum. At quarter’s end, total ARR had climbed to $1.16 billion, reflecting 23% growth compared with the same period a year ago. Net new ARR hit a record $44 million during the quarter, a 55% jump from the prior year period, according to Benzinga. SentinelOne’s roster of customers spending at least $100,000 annually expanded 17% year over year, reaching 1,702.
On the profitability side, the company nudged its non-GAAP operating margin outlook upward to 10%, a 40-basis-point increase that puts it 650 basis points above where the metric stood a year earlier, according to Yahoo Finance.
