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    Jason Lemkin on GitLab Q2 Beat After Cuts

    SaaStr founder notes revenue growth after workforce cuts and market exits.

    J✨
    1 Source, 27d ago, first seen 27d ago

    TLDR

    Jason Lemkin tweeted that GitLab posted revenue of $286.3M in its second quarter, up 21 percent and five points ahead of its own guide, with record gross bookings. Four months earlier the company had been labeled the consensus AI casualty in B2B, its stock trading in the high teens. Lemkin listed the steps taken in May: a 14 percent workforce reduction, exit from 22 countries, and removal of three layers of management. The post presents these moves as the direct lead-up to the reported results.

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    1 Source, first seen 27d ago

    Combined views

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    1 Source, first seen 27d ago

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    10 comments
    21 saves
    3 reposts

    Sentiment

    Positive——Negative

    Summary

    Not enough discussion yet.

    No sentiment analysis available yet.

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    1 Source

    @jasonlkGitLab Q2, and why it blew out the quarter: - Four months ago this was the consensus AI casualty in B2B. Stock in the high teens. They cut 14% of the company in May, exited 22 countries, took out three layers of management. - This week: revenue $286.3M, +21%, five points ahead of their own guide. Record gross bookings. Stock up ~15-20%. Four things actually drove it, and none of them are "AI hype": #1. More AI coding means more GitLab, not less Secure repositories +60% YoY. Code pushes +50%. CI/CD pipelines +40%. Among their most aggressive AI adopters, codebases have grown as much as 500%. Agents write the code. Somebody still has to store it, scan it, review it, and ship it. #2. They repriced GitLab Flex replaced fixed seat quantities with one dollar commitment that draws down across seats, credits, and usage, re-elected monthly. $20M+ committed from 130+ customers in six weeks. Paid consumption run rate went $15M to $40M+ in one quarter, targeting $100M by year end. #3. The enterprise leaned in Deals over $500K up more than 150%. First orders ~1,700, more than double. 8 of their 10 largest deals bought Ultimate. #4. Sales capacity +30% and productivity per rep +10% ... in the same year they cut 14% of the company. -> The bill: gross margin 90% to 86%, because they buy inference. -> And Flex pushes revenue later, so Q3 revenue is guided *below* Q2 despite record bookings. They took a worse revenue line this year to get a better business next year. That is the whole quarter.

    1 Source

    @jasonlkGitLab Q2, and why it blew out the quarter: - Four months ago this was the consensus AI casualty in B2B. Stock in the high teens. They cut 14% of the company in May, exited 22 countries, took out three layers of management. - This week: revenue $286.3M, +21%, five points ahead of their own guide. Record gross bookings. Stock up ~15-20%. Four things actually drove it, and none of them are "AI hype": #1. More AI coding means more GitLab, not less Secure repositories +60% YoY. Code pushes +50%. CI/CD pipelines +40%. Among their most aggressive AI adopters, codebases have grown as much as 500%. Agents write the code. Somebody still has to store it, scan it, review it, and ship it. #2. They repriced GitLab Flex replaced fixed seat quantities with one dollar commitment that draws down across seats, credits, and usage, re-elected monthly. $20M+ committed from 130+ customers in six weeks. Paid consumption run rate went $15M to $40M+ in one quarter, targeting $100M by year end. #3. The enterprise leaned in Deals over $500K up more than 150%. First orders ~1,700, more than double. 8 of their 10 largest deals bought Ultimate. #4. Sales capacity +30% and productivity per rep +10% ... in the same year they cut 14% of the company. -> The bill: gross margin 90% to 86%, because they buy inference. -> And Flex pushes revenue later, so Q3 revenue is guided *below* Q2 despite record bookings. They took a worse revenue line this year to get a better business next year. That is the whole quarter.