nCino, Inc. Reports Strong Start to Fiscal Year

Ncino, Inc. ((NCNO)) has held its Q1 earnings call. Read on for the main highlights of the call.

nCino, Inc. recently held its earnings call, revealing a strong start to the fiscal year with revenues surpassing expectations and notable growth in international markets. The company highlighted its promising AI capabilities and received positive feedback on new product launches. Despite facing challenges such as workforce reductions and slower subscription revenue growth, nCino’s performance and strategic initiatives suggest a balanced outlook for the future.

Strong Start to Fiscal Year 2026

The company reported total revenues of $144.1 million, exceeding its guidance. This success was largely driven by strong subscription revenues of $125.6 million, marking a 14% year-over-year growth. This robust start underscores nCino’s ability to deliver on its financial targets and sets a positive tone for the fiscal year.

AI Capabilities and Omnichannel Experiences

At the Annual nSight Customer Conference, nCino showcased new AI capabilities and omnichannel experiences, which were well received by the market. These innovations are expected to drive future subscription revenue growth, positioning nCino as a leader in leveraging technology to enhance customer experiences.

International Revenue Growth

The company reported a 22% year-over-year increase in non-U.S. total revenues, with non-U.S. subscription revenues growing by 31%. This strong international performance highlights nCino’s successful expansion efforts and its ability to capture market share beyond the U.S.

Positive Feedback on New Product Launches

nCino introduced 16 new banking adviser capabilities, receiving positive reception from customers. These new products are anticipated to enhance productivity and lower costs for clients, further solidifying nCino’s reputation for innovation and customer satisfaction.

Restructuring and Workforce Reduction

In a move to streamline operations and increase efficiency, nCino announced a restructuring event that will result in a 7% reduction of its global workforce. This decision reflects the company’s focus on optimizing its resources to better align with strategic goals.

Deceleration in Subscription Revenue Growth

Despite the overall positive performance, nCino reported a deceleration in subscription revenue growth. The company expects the fourth quarter to represent the lowest year-over-year growth, indicating potential challenges in maintaining its current growth trajectory.

Professional Services Margin Pressure

Professional services revenues increased by only 5% year-over-year, with ongoing pressures in the community bank space impacting margins. This highlights the challenges nCino faces in balancing growth with profitability in its professional services segment.

Forward-Looking Guidance

Looking ahead, nCino reiterated its guidance for fiscal 2026, anticipating subscription revenues between $507 million and $511 million, and total revenues between $578.5 million and $582.5 million, reflecting an 8.5% and 7% growth, respectively. The company also expects to save approximately $24 million annually from its restructuring efforts, with an immediate flow-through of $5 million to the fiscal 2026 non-GAAP operating income guidance, now increased to $112 million to $116 million.

In summary, nCino’s earnings call painted a picture of a company with strong financial performance and strategic initiatives that promise continued growth. While challenges such as workforce reductions and slower subscription revenue growth were acknowledged, the overall sentiment remains positive, with a focus on leveraging technology and expanding international markets to drive future success.