Netskope raised its fiscal 2027 revenue guidance to $879-$883 million, implying 24-25% year-over-year growth, but the cybersecurity company's stock remains a watchlist name rather than a clear buy. Non-GAAP gross margin improved to 77% in the fiscal first quarter, and management expects non-GAAP operating margin of negative 9.5% to negative 10% for the full year, with positive quarterly free cash flow in the second half. However, operating cash flow was negative $53.9 million and free cash flow was negative $57.2 million in the first quarter, while second-quarter non-GAAP operating margin guidance remains negative 14% to negative 15%. The stock's price target is $13 versus a July 1, 2026 price of $11.66, based on 2.72 times forward 12-month sales, but execution risks tied to pricing pressure, partner concentration, and slower expansion limit the upside. NTSK currently carries a Zacks Rank #4 (Sell) and has Value, Growth, Momentum, and VGM Scores of F.
Netskope, Inc. Class A Common StockRaised revenue guidance and improved gross margin are overshadowed by negative operating cash flow, negative free cash flow, and execution risks including pricing pressure and partner concentration, leading to a Zacks Rank #4 (Sell) and low VGM scores.
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