nCino (NASDAQ: NCNO) raised its full-year fiscal 2027 revenue guidance to between $644.0 million and $647.0 million, up from the previous range of $642.0 million to $646.0 million. The agentic AI banking platform made the adjustment after reporting second quarter revenues of $161.0 million, which beat the $159.150 million estimate.

The company’s earnings per share of $0.05 missed the $0.06 consensus. However, the Board of Directors authorized a new $100 million stock repurchase program, signaling confidence in the balance sheet despite the EPS miss. Shares rose 2.5% to trade at $21.33 on Wednesday.

Financial Performance

Total revenues for the quarter rose to $161.0 million from $148.8 million in Q2FY26, an 8% increase year-over-year. Subscription revenues, the primary recurring income stream, grew 10% to $143.5 million. Excluding U.S. mortgage, subscription revenues increased 12% year-over-year, reflecting strong sales execution that delivered approximately $1.3 million of upside to guidance.

Profitability expanded sharply on both GAAP and non-GAAP bases:

GAAP income from operations turned positive at $13.6 million, reversing a loss of $9.3 million in the same period last year. This represents an expansion of the GAAP operating margin by 1,500 basis points to 8%. Non-GAAP operating income increased 36% to $40.8 million, with the margin expanding 500 basis points to 25%.

Professional services revenues were $17.5 million, down 3% year-over-year, as the company prioritizes profitability over growth in this segment. The gross profit margin for professional services improved 600 basis points to 3% from negative 3% in Q2FY26.

Cash Flow and Balance Sheet

Free cash flow surged 170% to $34.0 million from $12.6 million in Q2FY26. As of July 31, 2026, cash and cash equivalents stood at $83.6 million.

The company also finalized an accelerated share repurchase program in the quarter, buying back approximately 6.0 million shares for $100 million. Combined with open market purchases of 4.2 million shares ($65 million), nCino repurchased roughly $165 million worth of stock in Q2FY27 alone. Since April 2025, total repurchases have reached approximately $300 million across 15.8 million shares.

Analyst Reactions

Following the earnings announcement, several analysts adjusted their price targets for nCino:

• Citizens analyst Aaron Kimson maintained the stock with a Market Outperform rating and raised the price target from $23 to $25.
• Barclays analyst Saket Kalia maintained the stock with an Overweight rating and boosted the price target from $22 to $23.
• Truist Securities analyst Terry Tillman maintained the stock with a Hold rating and raised the price target from $19 to $20.

What the Numbers Show

The divergence between GAAP and non-GAAP profitability highlights the impact of non-cash charges on reported earnings. While GAAP operating income swung from a loss to a profit, the non-GAAP figure of $40.8 million indicates underlying operational strength before accounting for amortization of intangibles, stock-based compensation, and restructuring costs. The 170% jump in free cash flow further supports this, suggesting that cash generation is outpacing the growth in capital expenditures and working capital requirements.

Business Highlights

nCino highlighted several strategic wins during the quarter:

• Renewed and expanded with four U.S. enterprise accounts representing over $900 billion in assets, with an average ACV increase of more than 10%.
• Signed a development finance institution in Germany, building momentum in the DACH region.
• Expanded a decade-long relationship with a U.S. regional bank to include Consumer Lending.
• Landed Hachijuni Nagano Bank in Japan for consumer lending operations consolidation.
• International growth remains strong, with non-U.S. revenues increasing by 9%.

AI adoption is accelerating, with 230 customers purchasing AI intelligence units. One U.S. enterprise customer estimates annual savings of over $5.5 million (160,000 hours) using the Locate and File functionality alone. Approximately 48% of total ACV is now on platform pricing, up from 40% last quarter.

CEO Sean Desmond stated, "We delivered an exceptional second quarter of fiscal 2027, once again exceeding all financial guidance. We are seeing many of our largest customers consolidating more of their most critical operations on nCino and expanding their commitments to include our market leading AI capabilities."

Outlook

For the third quarter ending October 31, 2026, nCino provided the following guidance:

• Total revenues between $161.25 million and $163.25 million.
• Subscription revenues between $143.25 million and $145.25 million.
• Non-GAAP operating income between $42.0 million and $44.0 million.

Full-year FY27 guidance includes total revenues between $644.0 million and $647.0 million, against an estimate of $644.669 million, and free cash flow between $137.0 million and $142.0 million. Subscription revenue guidance is set between $573.5 million and $576.5 million. Management noted that while U.S. mortgage headwinds persist, non-mortgage subscription revenue growth is expected to accelerate to 12% in Q4FY27.

Ncino (NASDAQ: NCNO) has issued its third-quarter sales guidance, projecting revenue between $161.250 million and $163.250 million. This range aligns closely with the consensus analyst estimate of $162.557 million, indicating market expectations are largely met by the company's outlook.

The guidance reflects a narrow band of approximately $2 million, suggesting limited variance in expected performance against the midpoint of analyst projections.

Guidance Overview

The company's projection places the lower bound slightly below the consensus while the upper bound exceeds it, effectively bracketing the market's expectation within its stated range.