Couchbase, Inc. ((BASE)) has held its Q4 earnings call. Read on for the main highlights of the call.
Couchbase’s recent earnings call reflected a generally positive sentiment, marked by strong growth metrics and significant achievements. The company celebrated record net new ARR, positive financial milestones, and impressive growth in Capella adoption. Despite these successes, challenges such as a decrease in ARR per customer and expectations of continued operating losses were acknowledged.
Record Net New ARR
Couchbase reported its highest ever quarterly net new ARR of $19.5 million, marking a 26% year-over-year increase. This achievement underscores the company’s robust growth and effective execution strategies, positioning it strongly in the competitive landscape.
Positive Financial Milestones
The company achieved its second consecutive quarter of positive free cash flow and its first quarter of positive non-GAAP net income. These milestones indicate improved financial health and operational efficiency, highlighting Couchbase’s progress towards sustainable profitability.
Capella Growth
Capella, Couchbase’s cloud offering, saw a remarkable 76% year-over-year increase in ARR, now constituting 16.2% of total ARR. This growth reflects significant adoption and increased consumption, reinforcing Capella’s role as a key driver of Couchbase’s success.
Strong Customer Expansions
Couchbase added 44 new logos in Q4, expanding its strategic accounts. Notably, the company now boasts two customers with ARR exceeding $10 million, demonstrating its ability to attract and grow large-scale partnerships.
Product Innovation and AI Integration
Couchbase announced a collaboration with NVIDIA for AI model services and expanded its analytics services to Google Cloud. These initiatives enhance the platform’s capabilities in AI and analytics, positioning Couchbase as a leader in technological innovation.
Decreased Q4 ARR per Customer
The ARR per customer decreased to $251,000 in Q4 from $273,000 the previous year. This decline is attributed to the increasing mix of Capella and the impact of large strategic expansions, indicating a shift in the customer base dynamics.
NRR Slightly Below Historical Levels
The dollar-based net retention rate was slightly below historical levels at greater than 114%, compared to the typical greater than 115%. This was due to an anomalous loss and down sell in fiscal 2025, highlighting areas for potential improvement.
Guidance for Continued Operating Losses
Couchbase provided forward-looking guidance indicating a non-GAAP operating loss ranging from negative $13.4 million to negative $8.4 million for fiscal 2026. This forecast suggests ongoing challenges in achieving profitability, despite the company’s growth and innovation.
Forward-Looking Guidance
Looking ahead, Couchbase anticipates total revenue between $228 million and $232 million for fiscal 2026, with ARR expected to reach between $273.6 million and $278.6 million. This represents a 16% year-over-year growth at the midpoint, reflecting the company’s optimistic outlook despite anticipated operating losses.
In summary, Couchbase’s earnings call highlighted a blend of strong growth and strategic advancements, tempered by challenges in profitability. The company’s record net new ARR, positive financial milestones, and Capella’s growth were key highlights, while decreased ARR per customer and continued operating losses present areas for improvement. Overall, Couchbase’s forward-looking guidance suggests a promising trajectory, with expectations of continued revenue and ARR growth.