GitLab (GTLB) Earnings Beat, Stock Pulls Back As Revenue Guide Light

Markets are keenly watching GitLab Inc. (NASDAQ: GTLB) as the software development platform gears up to release its latest earnings report after market close. The stock has repeatedly encountered resistance around the $49 mark in recent trading sessions. The question on everyone's mind: can the upcoming earnings provide the catalyst needed to propel GTLB above this stubborn ceiling?

The stock has pulled back more than 10% as results come through, with markets clearly unimpressed by the print for now.

Gitlab beat on top and bottom lines, with an EPS of $0.24, and revenue of $236million. The company guidance for Q3 did not hit the mark however, with the revenue range of $238-239million falling below the street's expectation ($241.5million). The FY26 revenue guide also came in light, with the midpoint of range ($939million) short of the $942.9million expected.

Analysts expect GitLab to report an average earnings per share (EPS) of $0.16 for the upcoming quarter, slightly above the $0.15 EPS reported in the same quarter last year, indicating modest profitability improvement. Revenue is projected to reach approximately $227.2 million, representing a strong year-over-year growth rate of 24.44%. These estimates suggest continued robust top-line expansion as GitLab maintains its momentum in the DevOps software space.

In the previous quarter, reported on June 10, 2025, GitLab delivered a non-GAAP earnings per share (EPS) of $0.33, beating estimates by a comfortable $0.10. Revenue also exceeded expectations, coming in at $211.4 million, $4.92 million above consensus. These strong numbers fueled optimism about GitLab's ability to execute its growth strategy.

GitLab's management has also been proactive in strengthening its leadership team. The appointment of Ian Steward as Chief Revenue Officer and David Henshall to the board of directors are seen as strategic moves to bolster revenue growth and provide valuable industry expertise.

Furthermore, the company continues to innovate with the general availability of GitLab Duo Self-Hosted and the private beta of GitLab Duo Workflow, demonstrating a commitment to enhancing its product offerings.

While the company has consistently beat earnings expectations, the law of large numbers eventually catches up, and maintaining such high growth rates becomes increasingly challenging. It's possible the market has simply gotten ahead of itself, and a period of consolidation or even a pullback is warranted before the stock can sustainably break through the $49 resistance level.