-- Annual Recurring Revenue increased 27% year-over-year to $899 million 
 
   -- Q2 revenue increased 29% year-over-year to $221 million 
 
   -- Results exceeded guidance across every metric 

SANTA CLARA, Calif., Sept. 02, 2026 (GLOBE NEWSWIRE) -- Netskope, Inc. (NASDAQ: NTSK) a leader in modern security and networking for the cloud and AI era, today announced financial results for the second quarter of fiscal year 2027 ended July 31, 2026.

"We are pleased with our strong second quarter performance, exceeding our guidance across every metric. Our results were driven by continued differentiating organic innovation, and durable customer demand for our Netskope One platform across security, networking, analytics and AI," said Sanjay Beri, CEO of Netskope. "We are encouraged by early traction with our AI Security solutions, validating that Netskope sits right at the intersection of cloud, AI, networking and security and is becoming part of the essential, adaptive fabric for the modern enterprise to adopt AI safely. With our rapid product innovation, we are well positioned to go after our massive market opportunity."

Second Quarter Fiscal 2027 Financial Highlights

   -- Annual Recurring Revenue $(ARR)$: ARR grew 27% year-over-year to $899 
      million as of July 31, 2026. 
 
   -- Revenue: Q2 revenue was $220.5 million, an increase of 29% 
      year-over-year. 
 
   -- Gross Profit and Margin: GAAP gross profit was $163.0 million, compared 
      to $123.2 million for the second quarter of fiscal 2026, and GAAP gross 
      margin was 74%, compared to 72% for the second quarter of fiscal 2026. 
      Non-GAAP gross profit was $169.1 million, compared to $127.3 million for 
      the second quarter of fiscal 2026, and non-GAAP gross margin was 77%, 
      compared to 75% for the second quarter of fiscal 2026. 
 
   -- Loss from Operations and Operating Margin: GAAP loss from operations was 
      $(89.8) million, compared to a loss of $(46.0) million for the second 
      quarter of fiscal 2026, and GAAP operating margin was (41)%, compared to 
      (27)% for the second quarter of fiscal 2026. Non-GAAP loss from 
      operations was $(19.3) million, compared to a loss of $(34.0) million for 
      the second quarter of fiscal 2026, and non-GAAP operating margin was (9)%, 
      compared to (20)% for the second quarter of fiscal 2026. 
 
   -- Net Loss Per Share: GAAP net loss per share was $(0.27), compared to 
      $(0.84) in the second quarter of fiscal 2026. Non-GAAP net loss per share 
      was $(0.03), compared to $(0.32) in the second quarter of fiscal 2026. 
 
   -- Cash Flow: Net cash used in operations was $(16.5) million, compared to 
      $(16.9) million used in operations in the second quarter of fiscal 2026 
      and operating cash flow margin was (7)%, compared to (10)% in the second 
      quarter of fiscal 2026. Free cash flow was $(29.8) million, compared to 
      $(19.7) million in the second quarter of fiscal 2026 and free cash flow 
      margin was (14)%, compared to (12)% in the second quarter of fiscal 2026. 
 
   -- Cash, Cash Equivalents, and Marketable Securities: Total cash, cash 
      equivalents, and marketable securities at the end of the second quarter 
      of fiscal 2027 was $1.1 billion. 

Recent Business Highlights

   -- Named a Leader in the Gartner(R) Magic Quadrant$(TM)$ for Secure Access 
      Service Edge (SASE) Platforms for the 3rd Year in a Row. Netskope was 
      positioned highest in Ability to Execute in Gartner's report. In the 
      corresponding Critical Capabilities report, Netskope is the only vendor 
      ranked as the highest scoring for three Use Cases, including: 
      Foundational SASE Platform Use Case, Zero Trust SASE Platform Use Case, 
      and the new Sovereign SASE Use Case. 
 
   -- Named a Leader in the Gartner(R) Magic Quadrant(TM) for Security Service 
      Edge for the 5th Year in a Row. Netskope has been named a Leader in every 
      year this report has been published since its inception, consistently 
      recognized both for its vision and its ability to execute. 
 
   -- Netskope joined NVIDIA's Open Secure AI Alliance, a coalition of industry 
      leaders committed to building open, frontier AI tools that defenders can 
      inspect, adapt, and trust. 
 
   -- Continued to lead in innovation with new product releases, including: 
 
          -- Netskope One DataSec Command Center, a unified control plane that 
             discovers, understands, tracks, and protects sensitive data 
             wherever it lives and moves across AI environments, cloud, the 
             network, on-premises, endpoint, email, and more. 
 
          -- Advancements to NewEdge AI Fast Path, which optimizes the network 
             path between users, sites, and agents to AI destinations for 
             faster inference results and minimizing time to first token (TTFT), 
             accelerating complex multi-prompt agentic AI workflows, as well as 
             optimizing LLM performance when accessing large volumes of data. 
             AI Fast Path was shown to reduce latency by as much as 90% to 
             popular AI destinations. 

Financial Outlook

Netskope is providing the following guidance for the third quarter and full year fiscal 2027:

For the third quarter of fiscal 2027, we expect:

   -- Revenue of $227 million to $229 million 
 
   -- Non-GAAP operating margin of approximately (8)% 
 
   -- Non-GAAP net loss per share of $(0.03) to $(0.04), using approximately 
      415 million weighted average common stock outstanding 

For the full year of fiscal 2027, we now expect:

   -- Total revenue of $888 million to $892 million 
 
   -- Non-GAAP gross margin of approximately 77% 
 
   -- Non-GAAP operating margin of approximately (9)% 
 
   -- Non-GAAP net loss per share of $(0.15), using approximately 415 million 
      weighted average common stock outstanding 
 
   -- Free cash flow margin of approximately 2% 

These statements are forward-looking, and actual results may differ materially. Refer to the Forward-Looking Statements safe harbor below for information on the factors that could cause our actual results to differ materially from these forward-looking statements.

A reconciliation of non-GAAP guidance measures to corresponding GAAP measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, reconciling items that may be incurred in the future, such as stock-based compensation and related employer payroll taxes, the effect of which may be significant.

Conference Call

Netskope will host a conference call at 2:00 p.m. Pacific Time / 5:00 p.m. Eastern Time today to discuss its financial results and outlook. The conference call will be available via live webcast and replay at the Investor Relations section of Netskope's website at investors.netskope.com.

Supplemental Financial and Other Information

Supplemental financial information can be accessed through Netskope's investor relations website at investors.netskope.com.

Conference Participation Schedule

Netskope will participate and present at the following upcoming investor conferences. Details of the events are as follows:

   -- Piper Sandler 2026 Growth Frontiers Conference - Tuesday, September 15, 
      2026, 1:00 p.m. Pacific Time / 3:00 p.m. Central Time 
 
   -- J.P. Morgan 2026 Software Forum - Friday, October 2, 2026, 10:00 a.m. 
      Pacific Time 

About Netskope

Netskope (NASDAQ: NTSK), a leader in modern security and networking for the cloud and AI era, addresses the needs of both security and networking teams by providing optimized access and real-time, context-based security for the AI ecosystem inclusive of agents, applications, tools, LLMs, people, devices, and data. Thousands of customers, including more than 30 of the Fortune 100, trust the Netskope One platform, its Zero Trust Engine, and its powerful NewEdge network to reduce risk and gain full visibility and control over cloud, AI, SaaS, web, and private applications -- providing security and accelerating performance without trade-offs. Learn more at netskope.com, netskope.ai, on LinkedIn, and Instagram.

Forward-Looking Statements

This press release contains forward-looking statements that involve risks and uncertainties, including, but not limited to, statements regarding our future financial and operating performance, including our GAAP and non-GAAP guidance and financial outlook for the third quarter of fiscal 2027 and full year fiscal 2027, market opportunity and the demand for AI security products. There are a significant number of factors that could cause actual results to differ materially from statements made in this press release, including but not limited to: macroeconomic influences and instability, geopolitical events, operations and financial results and the economy in general; risks associated with scaling our business and managing our rapid growth; our ability to expand our partner relationships; our ability to identify and effectively implement the necessary changes to address execution challenges; our limited experience with new products and the risks associated with new product offerings, including adoption by customers and the discovery of software bugs; our ability to attract and retain new customers; the failure to timely develop and achieve market acceptance of new products as well as existing products; rapidly evolving technological developments in the market for security, networking, analytics and AI products and our ability to innovate and remain competitive; length of sales cycles; risks related to the use of AI in our platform; and general market, political, economic and business conditions, as well as those risks and uncertainties included in filings we make with the Securities and Exchange Commission from time to time.