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Netskope, Inc.
(NASDAQ:NTSK)
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Rating:62Neutral
Price Target:
$23.50
▲(70.91% Upside)
Action:Reiterated
Date:10/17/26
The score is driven primarily by mixed fundamentals: rapid growth, improving gross margin, and better cash flow trends are outweighed by very large losses and high leverage. Technicals add support due to a strong multi-month uptrend and positive momentum indicators. Valuation is a headwind because losses drive a negative P/E, while earnings call guidance and sentiment are supportive but still reflect ongoing unprofitability.
Positive Factors
Rapid recurring-revenue growth
Strong ARR and revenue growth indicate sustained demand for Netskope’s cloud, data, and network security platform. Continued expansion at this scale can broaden the customer base, increase recurring revenue visibility, and support durable operating leverage as the business grows.
Negative Factors
Severe operating unprofitability
The scale of operating and net losses shows that strong revenue growth has not yet translated into a sustainable earnings model. Persistent expense intensity could require continued cost control or external funding, limiting strategic flexibility and delaying the point at which growth creates shareholder value.
Read all positive and negative factors
Positive Factors
Negative Factors
Rapid recurring-revenue growth
Strong ARR and revenue growth indicate sustained demand for Netskope’s cloud, data, and network security platform. Continued expansion at this scale can broaden the customer base, increase recurring revenue visibility, and support durable operating leverage as the business grows.
Read all positive factors
Netskope, Inc. (NTSK) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$8.91B
Dividend YieldN/A
Average Volume (3M)7.24M
Price to Earnings (P/E)―
Beta (1Y)2.59
Revenue Growth30.40%
EPS Growth-124.09%
CountryUS
Employees3,281
SectorGeneral
Sector StrengthN/A
IndustrySoftware - Infrastructure
Share Statistics
EPS (TTM)-1.89
Shares Outstanding267,134,740
10 Day Avg. Volume7,149,674
30 Day Avg. Volume7,239,757
Financial Highlights & Ratios
PEG Ratio-0.15
Price to Book (P/B)29.64
Price to Sales (P/S)8.13
P/FCF Ratio380.55
Enterprise Value/Market Cap0.53
Enterprise Value/Revenue5.94
Enterprise Value/Gross Profit8.49
Enterprise Value/Ebitda-6.63
Forecast
1Y Price Target
$18.89Price Target Upside37.40% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering16
EPS Forecast (FY)-0.15
Revenue Forecast (FY)$890.51M
Netskope, Inc. Business Overview & Revenue Model
Company Description
Netskope, Inc. operates as a leading cloud security provider, offering its clients a comprehensive, unified platform known as "Netskope One." This integrated solution is meticulously engineered to ensure robust data protection, facilitate secure a...
Netskope, Inc. Earnings Call Summary
Earnings Call Date:Sep 02, 2026
(Q2-2027)
| Next Earnings Date:Dec 10, 2026
Earnings Call Sentiment Positive
The call was strongly positive overall. Netskope reported solid Q2 growth, improved retention and margins, expanding platform adoption, strong AI security traction, major customer wins, continued innovation and raised full-year revenue guidance. The main negatives were ongoing operating and net losses, negative quarterly free cash flow, a workforce reduction, the temporary deferral of cash collections during the annual billing transition and the early stage and extended sales cycle for AI security monetization.Positive Updates
Strong Q2 Revenue and ARR Growth
Q2 ARR reached $899 million, up 27% year-over-year, with $54 million of net new ARR. Revenue grew 29% year-over-year to $220.5 million, ahead of the company's guided range.
Negative Updates
Operating Loss and Net Loss Persist
Q2 operating margin remained negative at 9%, despite improving 11 percentage points year-over-year. Net loss per share was $0.03.
Read all updates
Q2-2027 Updates
Positive
Negative
Strong Q2 Revenue and ARR Growth
Q2 ARR reached $899 million, up 27% year-over-year, with $54 million of net new ARR. Revenue grew 29% year-over-year to $220.5 million, ahead of the company's guided range.
Read all positive updates
Company Guidance
For Q3 fiscal 2027, Netskope expects revenue in the range of $227 million to $229 million, representing growth of approximately 24%, operating margin of approximately negative 8%, net loss per share of $0.03 to $0.04 using approximately 415 million weighted average common shares outstanding, and between $10 million and $20 million of free cash flow; for the full fiscal year, it expects revenue in the range of $888 million to $892 million, representing growth of approximately 26%, gross margin of approximately 77%, operating margin of approximately negative 9%, net loss per share of $0.15 using approximately 415 million weighted average common shares outstanding, positive free cash flow margin of approximately 2%, and capital expenditure of approximately 4% to 5% of revenue, while net new ARR is expected to grow year-over-year in the second half of the fiscal year, with a seasonally stronger fourth quarter, and the transition to annual billings is expected to be complete by the middle of next fiscal year.Netskope, Inc. Financial Statement Overview
Summary
Income Statement
28
Negative
Balance Sheet
32
Negative
Cash Flow
46
Neutral
| Breakdown | TTM | Jan 2026 | Jan 2025 | Jan 2024 |
|---|---|---|---|---|
Income Statement | ||||
| Total Revenue | 802.64M | 709.00M | 538.27M | 406.88M |
| Gross Profit | 561.18M | 482.67M | 347.90M | 243.25M |
| EBITDA | -718.74M | -606.68M | -204.20M | -263.25M |
| Net Income | -737.16M | -679.39M | -354.51M | -344.85M |
Balance Sheet | ||||
| Total Assets | 1.71B | 1.77B | 858.51M | 773.79M |
| Cash, Cash Equivalents and Short-Term Investments | 1.07B | 1.16B | 246.69M | 286.96M |
| Total Debt | 732.23M | 755.15M | 662.70M | 508.50M |
| Total Liabilities | 1.56B | 1.58B | 1.34B | 1.03B |
| Stockholders Equity | 156.79M | 194.53M | -485.59M | -256.82M |
Cash Flow | ||||
| Free Cash Flow | -68.26M | 15.15M | -151.10M | -208.32M |
| Operating Cash Flow | -41.09M | 38.07M | -110.68M | -167.17M |
| Investing Cash Flow | -788.61M | -628.65M | 2.24M | 176.95M |
| Financing Cash Flow | 877.07M | 895.37M | 109.86M | 6.29M |
Netskope, Inc. Technical Analysis
Positive
13.75
Price Trends
17.13
Positive
14.40
Positive
12.92
Positive
Market Momentum
1.16
Negative
68.75
Neutral
78.21
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NTSK, the sentiment is Positive. The current price of 13.75 is below the 20-day moving average (MA) of 19.40, below the 50-day MA of 17.13, and above the 200-day MA of 12.92, indicating a bullish trend. The MACD of 1.16 indicates Negative momentum. The RSI at 68.75 is Neutral, neither overbought nor oversold. The STOCH value of 78.21 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for NTSK.
Netskope, Inc. Risk Analysis
Netskope, Inc. disclosed 69 risk factors in its most recent earnings report. Netskope, Inc. reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Netskope, Inc. Peers Comparison
UnderperformOutperform
Sector (55)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
85 Outperform | $56.15B | 29.86 | 21.00% | 1.37% | 13.51% | 19.53% | |
78 Outperform | $125.41B | 60.86 | 187.95% | ― | 18.77% | 12.93% | |
74 Outperform | $422.88B | 31.92 | 27.39% | 1.56% | 11.77% | 27.65% | |
72 Outperform | $14.64B | 14.49 | 36.43% | ― | 4.64% | 25.51% | |
70 Outperform | $18.79B | 5.58 | 22.57% | 4.72% | 18.26% | 2280.55% | |
62 Neutral | $8.91B | -11.54 | -434.99% | ― | 30.40% | -124.09% | |
55 Neutral | $6.65B | 3.83 | -15.92% | 6.20% | 10.91% | 7.18% |
* General Sector Average
NTSK
Netskope, Inc.
22.20
-0.80
-3.48%
CHKP
Check Point
151.98
-41.58
-21.48%
CSCO
Cisco Systems
104.89
35.90
52.03%
FIS
Fidelity National Info
38.29
-26.74
-41.12%
FTNT
Fortinet
172.98
88.05
103.67%
GRMN
Garmin
295.40
49.30
20.03%
Netskope, Inc. Corporate Events
Business Operations and StrategyFinancial Disclosures
Netskope Posts Strong Q2 Results, Highlights AI Momentum
Positive
Sep 2, 2026
On September 2, 2026, Netskope reported strong results for its second quarter of fiscal 2027, ended July 31, 2026, with annual recurring revenue up 27% year-over-year to $899 million and revenue up 29% to $220.5 million, beating guidance across al...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.