SentinelOne CEO agrees he ‘needs to perform better’ after Q1 earnings

SentinelOne Inc (NYSE: S) opened more than 35% down today after reporting disappointing results for its first financial quarter.

SentinelOne stock down on weak outlook

The cybersecurity stock is being punished also because the management cited a slowdown in business spending and slashed their guidance for the full year.

SentinelOne now forecasts up to $600 million of sales in fiscal 2024. Still, on CNBC’s “Squawk Box”, CEO Tomer Weingarten said:

The company’s second-quarter outlook also came in shy of Street estimates.

SentinelOne improved margins in Q1

On the plus side, SentinelOne improved its adjusted gross margin by 700 basis points to 75% in the recently concluded quarter.

Its annualised recurring revenue (ARR) went up a whopping 75% year-on-year to $563.6 million but still missed $594.4 million that experts had forecast. According to the Chief Executive:

Heading into the earnings print, Wall Street had a consensus “overweight” rating on SentinelOne stock.

SentinelOne to cut jobs

SentinelOne also confirmed that it’s cutting costs to pave its path to profitability.

To that end, the California-based company plans on lowering its headcount by about 5.0%. Commenting further on the weak results and guidance, CEO Weingarten said:

In total, the announced layoff will affect less than 100 employees. Versus its year-to-date high, SentinelOne stock is now down about 40%.

Notable figures in SentinelOne Q1 earnings report

• Lost $106.9 million versus the year-ago $89.8 million
• Per-share loss also climbed from 33 cents to 37 cents
• Adjusted loss printed at 15 cents as per the press release
• Sales increased just over 70% YoY to $133.4 million
• Consensus was 17 cents a share on $136.6 million revenue

CEO Weingarten also sounded bullish on artificial intelligence for cybersecurity today on CNBC.