Track market-moving stories before they get noisy

MIAMI--(BUSINESS WIRE)--Summit Therapeutics Inc. (NASDAQ: SMMT) today noted that its partner Akeso Inc. announced positive overall survival (OS) results from the randomized, double-blind Phase III HARMONi-2 study evaluating ivonescimab monotherapy against pembrolizumab monotherapy in patients with locally advanced or metastatic non-small cell lung cancer (NSCLC) whose tumors have positive PD-L1 expression. HARMONi-2 (AK112-303) is a single-region, multi-center Phase III study conducted in China and sponsored by Akeso, with all relevant data exclusively generated, managed, and analyzed by Akeso.

In this preplanned analysis of OS, a secondary endpoint in the HARMONi-2 study, Akeso reported that ivonescimab monotherapy demonstrated a statistically significant improvement compared to pembrolizumab monotherapy. Results from this HARMONi-2 analysis are scheduled to be presented at an upcoming medical conference.

Akeso received marketing authorization for ivonescimab from China’s National Medical Products Administration (NMPA) based on the results of HARMONi-2 in April 2025. In the study’s primary analysis, ivonescimab monotherapy demonstrated a statistically significant improvement in the trial’s primary endpoint, progression-free survival (PFS) by Independent Radiologic Review Committee (IRRC), when compared to pembrolizumab monotherapy, achieving a hazard ratio (HR) of 0.51 (95% CI: 0.38, 0.69; p<0.0001). A clinically meaningful benefit was demonstrated across clinical subgroups, including those with PD-L1 low expression, PD-L1 high expression, squamous, and non-squamous histologies.1

The HARMONi-2 study was conducted by Akeso in China, where ivonescimab is approved and commercially available for indications in NSCLC. Ivonescimab remains investigational and is not approved by any regulatory authority in Summit’s license territories, including the United States and Europe.

About Ivonescimab

Ivonescimab, known as SMT112 in Summit’s license territories, North America, South America, Europe, the Middle East, Africa, and Japan, and as AK112 outside of Summit’s license territories, is a novel, potential first-in-class investigational bispecific antibody combining the effects of immunotherapy via a blockade of PD-1 with the anti-angiogenesis effects associated with blocking VEGF into a single molecule. By design, ivonescimab displays unique cooperative binding to each of its intended targets with multifold higher affinity to PD-1 when in the presence of VEGF.

This design is intended to differentiate ivonescimab as there is potentially higher expression (presence) of both PD-1 and VEGF in tumor tissue and the tumor microenvironment (TME) as compared to normal tissue in the body. Summit believes ivonescimab’s specifically engineered tetravalent structure (four binding sites) enables higher avidity (accumulated strength of multiple binding interactions) in the TME (Zhong, et al, iScience, 2025). This tetravalent structure, the intentional novel design of the molecule, and bringing these two targets into a single bispecific antibody with cooperative binding qualities have the potential to direct ivonescimab to the tumor tissue versus healthy tissue. The intent of ivonescimab’s design, together with a half-life of 6 to 7 days after the first dose (Zhong, et al, iScience, 2025) increasing to approximately 10 days at steady state dosing, is to improve upon previously established efficacy thresholds, side effects, and safety profiles associated with prior approved drugs to these targets.

Ivonescimab was engineered by Akeso Inc. (HKEX Code: 9926.HK) and is currently utilized in multiple Phase III clinical trials. Over 4,000 patients have been treated with ivonescimab in clinical studies globally and over 70,000 patients when considering those treated in a commercial setting in China, as noted by Akeso.

There are currently 16 Phase III clinical studies that are either announced, ongoing, or have been completed studying ivonescimab, five of which are Summit-sponsored global studies, one of which is a multiregional study sponsored by a cooperative group, and 10 of which are being or have been conducted in China by Akeso. Summit began its clinical development of ivonescimab in NSCLC, commencing enrollment in 2023 in two multiregional Phase III clinical trials, HARMONi and HARMONi-3. In 2025, Summit began enrolling patients in HARMONi-7. Summit expanded its Phase III clinical development program into colorectal cancer (CRC) in the fourth quarter of 2025 by initiating enrollment in HARMONi-GI3. In 2026, Summit announced initiation of HARMONi-GU1, a Phase II/III study in urothelial carcinoma (bladder cancer) with global clinical trial site activations planned to begin by the fourth quarter of 2026.

HARMONi is a Phase III clinical trial evaluating ivonescimab combined with chemotherapy compared to placebo plus chemotherapy in patients with EGFR-mutated, locally advanced or metastatic non-squamous NSCLC who were previously treated with a third-generation EGFR TKI (e.g., osimertinib). Detailed results of the study were provided in September 2025, and a Biologics License Application (BLA) was submitted to the United States Food and Drug Administration (FDA) for marketing authorization, which the FDA accepted for filing in January 2026; the goal Prescription Drug User Fee Act (PDUFA) date is November 14, 2026.

HARMONi-3 is a Phase III clinical trial evaluating ivonescimab combined with chemotherapy compared to pembrolizumab combined with chemotherapy in patients with first-line metastatic, squamous or non-squamous NSCLC, irrespective of PD-L1 expression. The clinical trial is evaluating the two histologies as individual, separately powered cohorts with independent statistical powering.

HARMONi-7 is a Phase III clinical trial evaluating ivonescimab monotherapy compared to pembrolizumab monotherapy in patients with first-line metastatic NSCLC whose tumors have high PD-L1 expression.

HARMONi-GI3 is a Phase III clinical trial evaluating ivonescimab in combination with chemotherapy compared with bevacizumab plus chemotherapy in patients with first-line unresectable metastatic CRC.

HARMONi-GU1 is a Phase II/III clinical trial evaluating ivonescimab plus the antibody drug conjugate (ADC) enfortumab vedotin (EV) compared to pembrolizumab plus EV as first-line therapy in patients with previously untreated locally advanced or metastatic urothelial carcinoma (la/mUC).

ILLUMINE is a Phase III study being conducted by GORTEC, a cooperative group dedicated to Head and Neck Oncology, in recurrent / metastatic head and neck squamous cell carcinoma (r/m HNSCC). ILLUMINE is a three-arm Phase III clinical trial designed to evaluate ivonescimab monotherapy, as well as ivonescimab in combination with ligufalimab, Akeso’s proprietary anti-CD47 monoclonal antibody, compared to monotherapy pembrolizumab in patients with PD-L1 positive r/m HNSCC.

Five Phase III ivonescimab clinical trials have read out to date, all five with positive data. Four of these five studies are in NSCLC, and one is in biliary tract cancer (BTC). In addition to Summit’s positive HARMONi study, Akeso has had positive read-outs in three single-region (China), randomized Phase III clinical trials, HARMONi-A, HARMONi-2, and HARMONi-6, for ivonescimab in NSCLC, including a statistically significant overall survival benefit in all three studies from China. Akeso has also reported a statistically significant OS benefit in the single-region (China), randomized Phase III HARMONi-GI1 trial in advanced BTC.

HARMONi-A was a Phase III clinical trial which evaluated ivonescimab combined with chemotherapy compared to placebo plus chemotherapy in patients with EGFR-mutated, locally advanced or metastatic non-squamous NSCLC who have progressed after treatment with an EGFR TKI.

HARMONi-2 is a Phase III clinical trial evaluating monotherapy ivonescimab against monotherapy pembrolizumab in patients with locally advanced or metastatic NSCLC whose tumors have positive PD-L1 expression.

HARMONi-6 is a Phase III clinical trial evaluating ivonescimab in combination with platinum-based chemotherapy compared with tislelizumab, an anti-PD-1 antibody, in combination with platinum-based chemotherapy in patients with locally advanced or metastatic squamous NSCLC, irrespective of PD-L1 expression.

HARMONi-GI1 is a Phase III clinical trial evaluating ivonescimab in combination with chemotherapy compared with durvalumab plus chemotherapy as a first-line treatment for patients with advanced BTC.

Akeso is actively conducting additional Phase III clinical studies in settings outside of NSCLC and biliary-tract cancer, including triple-negative breast cancer, head and neck squamous cell carcinoma, small cell lung cancer, colorectal cancer, and pancreatic cancer.

Ivonescimab is an investigational therapy that is not approved by any regulatory authority in Summit’s license territories, including the United States and Europe. Ivonescimab was initially approved for marketing authorization in China in May 2024.

About Summit Therapeutics Inc.

Summit Therapeutics Inc. is a biopharmaceutical oncology company focused on the discovery, development, and commercialization of patient-, physician-, caregiver- and societal-friendly medicinal therapies intended to improve quality of life, increase potential duration of life, and resolve serious unmet medical needs.

Summit was founded in 2003 and the company’s shares are listed on the Nasdaq Global Market (symbol "SMMT"). Summit is headquartered in Miami, Florida, with additional offices in Palo Alto, California, Princeton, New Jersey, Dublin, Ireland, and Oxford, UK.

For more information, please visit https://www.smmttx.com and follow Summit on X @SMMT_TX.

Summit Forward-Looking Statements

Any statements in this press release about the Company’s future expectations, plans and prospects, including but not limited to, statements about the clinical and preclinical development of the Company’s product candidates, entry into and actions related to the Company’s partnership with Akeso Inc. and other collaborations, the intended use of the net proceeds from the private placements, the Company's anticipated spending and cash runway, the therapeutic potential of the Company’s product candidates, the potential commercialization of the Company’s product candidates, the timing of initiation, completion and availability of data from clinical trials, the potential submission of applications for marketing approvals, the expected timing of BLA submissions or FDA decisions, potential acquisitions, statements about the previously disclosed At-The-Market equity offering program (“ATM Program”), the expected proceeds and uses thereof, the Company’s estimates regarding stock-based compensation, and other statements containing the words "anticipate," "believe," "continue," "could," "estimate," "expect," "intend," "may," "plan," "potential," "predict," "project," "should," "target," "would," and similar expressions, constitute forward-looking statements within the meaning of The Private Securities Litigation Reform Act of 1995. Actual results may differ materially from those indicated by such forward-looking statements as a result of various important factors, including the Company’s ability to sell shares of our common stock under the ATM Program, the conditions affecting the capital markets, general economic, industry, or political conditions, including the effects of geopolitical developments, domestic and foreign trade policies, and monetary policies, the results of our evaluation of the underlying data in connection with the development and commercialization activities for ivonescimab, the outcome of discussions with regulatory authorities, including the Food and Drug Administration, the uncertainties inherent in the initiation of future clinical trials, availability and timing of data from ongoing and future clinical trials, the results of such trials, and their success, global public health crises, that may affect timing and status of our clinical trials and operations, whether preliminary results from a clinical trial will be predictive of the final results of that trial or whether results of early clinical trials or preclinical studies will be indicative of the results of later clinical trials, whether business development opportunities to expand the Company’s pipeline of drug candidates, including without limitation, through potential acquisitions of, and/or collaborations with, other entities occur, expectations for regulatory approvals, laws and regulations affecting government contracts and funding awards, availability of funding sufficient for the Company’s foreseeable and unforeseeable operating expenses and capital expenditure requirements and other factors discussed in the "Risk Factors" and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” sections of filings that the Company makes with the Securities and Exchange Commission. Summit defines a “positive study” as a clinical study with one or more prespecified primary endpoints in which one of those endpoints achieves a statistically significant benefit according to the protocol or statistical analysis plan. Any change to our ongoing trials could cause delays, affect our future expenses, and add uncertainty to our commercialization efforts, as well as to affect the likelihood of the successful completion of clinical development of ivonescimab. Accordingly, readers should not place undue reliance on forward-looking statements or information. In addition, any forward-looking statements included in this press release represent the Company’s views only as of the date of this release and should not be relied upon as representing the Company’s views as of any subsequent date. The Company specifically disclaims any obligation to update any forward-looking statements included in this press release.

References:

Xiong A, Wang L, Chen J, Wu L, Liu B, Yao J, et al. Ivonescimab versus pembrolizumab for PD-L1-positive non-small cell lung cancer (HARMONi-2): a randomised, double-blind, phase 3 study in China. Lancet. 2025;405(10481):839-849. doi:10.1016/S0140-6736(24)02722-3. Summit Therapeutics and the Summit Therapeutics logo are registered trademarks of Summit Therapeutics Inc. and/or its affiliates. Copyright 2026, Summit Therapeutics Inc. All Rights Reserved.

Premium Feature

Moneyball Superscore

54/100

Today's Change

(

18.75

%) $

0.57

Current Price

$

3.61

Eos Energy Enterprises (EOSE +18.75%), a grid-scale long-duration battery storage systems provider, closed at $3.61, up 18.75%. The stock climbed following a collaboration between Alphabet's (GOOG +0.53%) (GOOGL +0.63%) Google and MN8 Energy. Investors are watching project spending and execution. Trading volume reached 73.1M shares, coming in about 184% above its three-month average of 25.7M shares. Eos Energy Enterprises IPO'd in 2020 and has fallen 64% since going public.

How the markets moved todayThe S&P 500 (^GSPC +0.46%) closed at 7,667, up 0.47%, while the Nasdaq Composite (^IXIC +0.45%) closed at 26,218, up 0.45%. Among electrical equipment and grid-scale battery energy storage systems peers, Fluence Energy (FLNC +1.34%) closed at $10.56, up 1.34%, while Stem (STEM -0.55%) closed at $5.43, down 1.09%.

What this means for investorsThe collaboration among the three companies will be owned and operated by power platform MN8 Energy, which will use Eos Energy's zinc-based and lithium-ion storage energy solutions to power Google's data centers. In a press release, MN8 went on to explain:

The integrated portfolio adds new clean, dispatchable capacity to the grid serving Google's data centers in the region, including a planned project in West Virginia. The solar project is expected to reach commercial operation in 2028, with lithium-ion storage and long-duration storage following in 2029 and 2030, respectively.In less than a year, EOSE stock has plummeted from $18 to $3.61 amid earnings misses, a lack of progress toward profitability, and manufacturing delays, but today's news may offer a lifeline for the once-promising energy storage company. That said, Eos has burned $422 million in FCF while earning $214 million in sales over the last year, so it is far from out of the woods, even with this deal. Investors should be prepared for volatility if they are interested in the stock, as equity and debt raises will be likely.

Josh Kohn-Lindquist has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet and Fluence Energy. The Motley Fool recommends Stem. The Motley Fool has a disclosure policy.

Is Hewlett Packard Enterprise (HPE) Overvalued After Q3 Earnings Beat? EPS of $1.06 vs Estimate of $0.47; Revenue at $12.2B Robust Growth and Strategic Positioning Highlighted in Latest Financial Report

Hewlett Packard Enterprise Co HPE released its 8-K filing on September 2, 2026, reporting impressive financial results for the third quarter ended July 31, 2026. The company achieved record revenue of $12.2 billion, marking a 34% increase year-over-year, and significantly surpassed both profit and growth expectations.

Hewlett Packard Enterprise is a leading information technology vendor that offers hardware and software solutions for enterprises. Its primary products include compute servers, storage arrays, and networking equipment, as well as a high-performance computing division. The company is focused on becoming an edge-to-cloud technology provider, ensuring that its portfolio supports both hybrid cloud and hyperconverged infrastructure.

Performance Highlights and ChallengesHPE's substantial revenue and profit increases reflect consistent customer demand across its segments. The company reported GAAP operating profit up 464% year-over-year with a remarkable GAAP diluted net earnings per share (EPS) of $1.06, exceeding analyst estimates of $0.47. However, HPE continues to navigate challenges such as competitive pressures in the evolving technology landscape and the need to maintain growth momentum amidst shifting market dynamics.

The quarterly results underscore the importance of HPE's strategic focus on AI, which is anticipated to be a multi-year growth catalyst for the business. CEO Antonio Neri emphasized the "durability of our profitable growth momentum," showcasing how HPE's differentiated offerings position the company to capitalize on AI advancements at scale.

Financial Achievements and Industry RelevanceNoteworthy financial achievements include a gross margin increase of over 1,000 basis points compared to last year, leading to a GAAP gross margin of 40.1%. Free cash flow reached $1.0 billion, and the company has committed to returning at least 75% of its free cash flow to shareholders. Such significant profitability improvements are critical for a hardware company and indicate strong operational efficiency.

For the quarter, key metrics illustrate the company's financial health: revenue of $12.2 billion, GAAP operating profit of $1.393 billion, and a net income of $1.511 billion. This financial strength positions HPE favorably to address upcoming industry challenges and fulfill future growth potential.

Key metrics and financial data from the income statement are summarized as follows:

MetricQ3 FY2026Q2 FY2026Q3 FY2025Net Revenue$12.213 billion$10.678 billion$9.136 billionGAAP Operating Profit$1.393 billion$747 million$247 millionNet Earnings$1.511 billion$595 million$276 millionGAAP Diluted EPS$1.06$0.44$0.21

GuruFocus Valuation CheckHewlett Packard Enterprise Co HPE holds a GF Score of 69 out of 100, indicating above-average performance compared to its peers. However, the stock appears overvalued according to GuruFocus’s analysis, with a GF Value calculated at $25.55 compared to the current price of $52.23, representing a 104.4% overvaluation. This overvaluation suggests potential risks for investors considering entry points into the stock.

Financial strength has been assessed at 5 out of 10, indicating moderate resilience in economic downturns, while profitability ranks slightly higher at 6 out of 10. Growth ranks positively at 8 out of 10 indicating robust potential, particularly in a tech-driven market. Furthermore, the predictability of HPE's earnings has received a lower rating of 1 star, hinting at volatility and uncertainty in maintaining historical performance. Investors should also note that insider activity has seen significant selling, amounting to $43.1 million in the past year, which may signal cautious expectations for future growth.

For a deeper dive, visit the Hewlett Packard Enterprise Co stock page on GuruFocus.

Explore the complete 8-K earnings release (here) from Hewlett Packard Enterprise Co for further details.

GuruFocus context: GuruFocus’ GF Value™ estimates fair value near $25.55 (104.4% overvalued); its GF Score™ is 69/100; 16 gurus currently hold the stock, with 7 adding and 10 trimming positions in recent quarters — guru 13F data Simply Wall St and Morningstar don’t have. See the full Hewlett Packard Enterprise Co HPE research.

This stock alert was generated using automated technology and GuruFocus financial data to provide readers with timely and accurate market reporting. This content was reviewed by GuruFocus editorial team prior to publication. Please send any questions or comments about this story to [email protected].

MENLO PARK, Calif.--(BUSINESS WIRE)--Snowflake (NYSE: SNOW), the AI Data Cloud company, today announced financial results for its second quarter of fiscal 2027, ended July 31, 2026.

"Snowflake delivered another strong quarter, with product revenue of $1.49 billion, up 37% year-over-year, as Snowflake continues to power the enterprise AI revolution,” said Sridhar Ramaswamy, CEO of Snowflake. “AI continues to compound our advantages, creating a flywheel effect across the business. CoWork and CoCo are driving transformational outcomes for our customers, while fueling rapid adoption, user growth, new workloads, and overall platform consumption. Our rapid pace of innovation, tight go-to-market execution, and operational discipline position us well to capture the opportunity ahead. The Agentic Enterprise runs on Snowflake, and we're just getting started."

“Q2 marks our third consecutive quarter of product revenue growth acceleration, driven by strength in both our core data platform and a meaningful step-up in AI revenue,” said Brian Robins, CFO of Snowflake. “Importantly, we delivered this accelerating growth while expanding operating margin. Balancing growth with discipline remains a top priority, and we are raising our full-year product revenue growth guidance to 36% year-over-year.”

Snowflake Business Highlights:

AI Momentum: CoCo surpassed 9,100 accounts1, adding more than 2,000 accounts in the quarter alone, while CoWork expanded to 5,800 accounts1. Accelerated Product Velocity: Launched over 330 product capabilities to general availability in the first half of fiscal 2027, up 35% year-over-year, and recently introduced Cortex Sense for business context and Cortex AI Gateway, which extends AI from insight to action through its integration of Natoma. AI Customer Wins: Customers like 1Password and Indeed chose Snowflake as the foundation for their data and AI transformation. Sayari cut costs by more than half and is using CoCo to accelerate the migration of 12 billion records. Customer Growth: Added 692 net new customers in the quarter, up 32% year-over-year, including 14 net new Forbes Global 2000 customers. See the section titled “Key Business Metrics” for definitions of product revenue, net revenue retention rate, customers with trailing 12-month product revenue greater than $1 million, Forbes Global 2000 customers, and remaining performance obligations.

Financial Outlook:

Our guidance includes GAAP and non-GAAP financial measures.

For the third quarter of fiscal 2027, the company expects:

Product revenue of $1,588 million to $1,593 million, representing 37% to 38% year-over-year growth Non-GAAP operating margin2 of 15.5% Non-GAAP weighted-average shares used in computing net income per share attributable to common stockholders—diluted2,3 of 382 million For the full-year of fiscal 2027, the company expects:

Product revenue of $6,070 million, representing 36% year-over-year growth, up from previous guidance of $5,840 million, or 31% year-over-year growth Non-GAAP product gross margin2 of 74.0% Non-GAAP operating margin2 of 14.5%, up from previous guidance of 13.5% Non-GAAP adjusted free cash flow margin2 of 23.0% Non-GAAP weighted-average shares used in computing net income per share attributable to common stockholders—diluted2,3 of 380 million A reconciliation of GAAP guidance measures to corresponding non-GAAP guidance measures is not available on a forward-looking basis without unreasonable effort due to the uncertainty regarding, and the potential variability of, expenses that may be incurred in the future. Stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, are impacted by the timing of employee stock transactions, the future fair market value of our common stock, and our future hiring and retention needs, all of which are difficult to predict and subject to constant change. These factors could be material to our results computed in accordance with GAAP. Our fiscal year ends January 31, and numbers are rounded for presentation purposes.

Second Quarter Fiscal 2027 GAAP and Non-GAAP Results:

The following table summarizes our financial results for the second quarter of fiscal 2027:

Second Quarter Fiscal 2027

GAAP Results

Second Quarter Fiscal 2027

Non-GAAP Results(1)

Amount

(millions)

Year/Year

Growth

Product revenue

$1,491.9

37%

Amount

(millions)

Margin

Amount

(millions)

Margin

Product gross profit

$1,057.4

70.9%

$1,114.1

74.7%

Operating income (loss)

($263.0)

(17.0%)

$237.0

15.3%

Net cash provided by operating activities

$91.4

5.9%

(2)

Free cash flow

$83.8

5.4%

Adjusted free cash flow

$92.3

6.0%

  (1) We report non-GAAP financial measures in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for an explanation of non-GAAP financial measures, and the table titled “GAAP to Non-GAAP Reconciliations” for a reconciliation of GAAP to non-GAAP financial measures.

(2) Calculated as net cash provided by operating activities as a percentage of revenue.

Note: Fiscal year ends January 31. Numbers are rounded for presentation purposes.

Conference Call Details

The conference call will begin at 2 p.m. Pacific Time on September 2, 2026. Investors and participants may attend the call by dialing 1-800-330-6730 for domestic callers and 1-646-769-9500 for international callers (Access code: 102163).

The call will also be webcast live on the Snowflake Investor Relations website at https://investors.snowflake.com.

An audio replay of the conference call and webcast will be available two hours after its completion and will be accessible for 30 days on the Snowflake Investor Relations website.

Investor Presentation Details

An investor presentation providing additional information and analysis can be found at https://investors.snowflake.com.

Statement Regarding Use of Non‑GAAP Financial Measures

We report the following non-GAAP financial measures, which have not been prepared in accordance with generally accepted accounting principles in the United States (GAAP), in addition to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP.

Non-GAAP Product gross profit, Operating income, Net income, Net income attributable to Snowflake Inc., and Net income per share attributable to Snowflake Inc. common stockholders—basic and diluted. Non-GAAP product gross profit, operating income, net income, and net income attributable to Snowflake Inc. are each defined as the respective GAAP measure, excluding, as applicable, the effect of (i) stock-based compensation-related charges, including employer payroll tax-related items on employee stock transactions, (ii) amortization of acquired intangibles, (iii) expenses associated with acquisitions and strategic investments, (iv) amortization of debt issuance costs, (v) restructuring charges or recoveries, net, (vi) asset impairment related to office facility exits, net of associated sublease income, if any, (vii) adjustments attributable to noncontrolling interest, if any, and (viii) the related income tax effect of these adjustments as well as the non-recurring income tax expense or benefit associated with acquisitions. Non-GAAP product gross margin is calculated as non-GAAP product gross profit as a percentage of product revenue. Non-GAAP operating margin is calculated as non-GAAP operating income as a percentage of revenue. Our non-GAAP net income per share attributable to Snowflake Inc. common stockholders—basic is calculated by dividing non-GAAP net income attributable to Snowflake Inc. by the weighted-average number of shares of common stock outstanding during the period. Our non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted is calculated by dividing non-GAAP net income attributable to Snowflake Inc. by the non-GAAP weighted-average number of diluted shares outstanding, which includes (a) the effect of all potentially dilutive common stock equivalents (stock options, restricted stock units, employee stock purchase rights under our 2020 Employee Stock Purchase Plan), (b) the potential dilutive effect of the shares issuable upon conversion of the Notes using the if-converted method, and (c) the antidilutive impact, if any, of the Capped Calls entered into in connection with the Notes. The Capped Calls are expected to reduce the potential dilution to our common stock upon any conversion of the Notes under certain circumstances. Under GAAP, the antidilutive impact of the Capped Calls is not reflected in diluted shares outstanding until exercised. The potential dilutive effect of outstanding restricted stock units with performance conditions not yet satisfied is included in the non-GAAP weighted-average number of diluted shares at forecasted attainment levels to the extent we believe it is probable that the performance conditions will be met. The potential dilutive effect of outstanding restricted stock units with market conditions is included in the non-GAAP weighted-average number of diluted shares to the extent the market conditions are met. Amounts attributable to noncontrolling interest were zero or not material for all periods presented. Beginning with the fourth quarter of fiscal 2026, the Company no longer attributes a portion of non-GAAP net income to noncontrolling interest as it no longer controls a majority-owned subsidiary. The calculation of non-GAAP basic and diluted net income per share attributable to common stockholders for the fourth quarter of fiscal 2026 and subsequent periods aligns with the methodology used to calculate non-GAAP basic and diluted net income per share attributable to Snowflake Inc. common stockholders as described above. We believe the presentation of operating results that exclude these items that are (i) non-cash items, (ii) non-recurring items, or (iii) items that have highly variable amounts due to factors beyond our control and are unrelated to our core operations such that management does not consider them in evaluating the business performance or making operating plans, provides useful supplemental information to investors and facilitates the analysis of our operating results and comparison of operating results across reporting periods. Free cash flow. Free cash flow is defined as net cash provided by operating activities reduced by purchases of property and equipment and any capitalized software development costs. Cash outflows for employee payroll tax items related to the net share settlement of equity awards are included in cash flow for financing activities and, as a result, do not have an effect on the calculation of free cash flow. Free cash flow margin is calculated as free cash flow as a percentage of revenue. We believe these measures provide useful supplemental information to investors because they are indicators of the strength and performance of our core business operations. Adjusted free cash flow. Adjusted free cash flow is defined as free cash flow plus (minus) net cash paid (received) on employer and employee payroll tax-related items on employee stock transactions. Employee payroll tax-related items on employee stock transactions are generally pass-through transactions that are expected to have a net zero impact on free cash flow over time, but that may impact free cash flow in any given fiscal quarter due to differences between the time that we receive funds from our employees and the time we remit those funds to applicable tax authorities. We believe that excluding the effects of these payroll tax-related items will enhance investors' ability to evaluate our free cash flow performance, including on a quarter-over-quarter basis. Adjusted free cash flow margin is calculated as adjusted free cash flow as a percentage of revenue. We believe these measures provide useful supplemental information to investors because they are indicators of the strength and performance of our core business operations. We use these non-GAAP financial measures internally for financial and operational decision-making purposes and as a means to evaluate period-to-period comparisons. Non-GAAP financial measures are not meant to be considered in isolation or as a substitute for comparable GAAP financial measures and should be read only in conjunction with our condensed consolidated financial statements prepared in accordance with GAAP. Our presentation of non-GAAP financial measures may not be comparable to similar measures used by other companies. We encourage investors to carefully consider our results under GAAP, as well as our supplemental non-GAAP information and the reconciliation between these presentations, to more fully understand our business. Please see the tables included at the end of this release for the reconciliation of GAAP to non-GAAP results.

Key Business Metrics

We monitor our key business metrics, including (i) free cash flow and (ii) the other metrics set forth below to help us evaluate our business and growth trends, establish budgets, measure the effectiveness of our sales and marketing efforts, and assess operational efficiencies. See the section titled “Statement Regarding Use of Non-GAAP Financial Measures” for the definition of free cash flow. The calculation of our key business metrics may differ from other similarly titled metrics used by other companies, securities analysts, or investors.

Product Revenue. Product revenue is a key metric for us because we recognize revenue based on platform consumption, which is inherently variable at our customers’ discretion, and not based on the amount and duration of contract terms. Product revenue is primarily derived from the consumption of compute, storage, and data transfer resources by customers on our platform. Customers have the flexibility to consume more than their contracted capacity during the contract term and may have the ability to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. Our consumption-based business model distinguishes us from subscription-based software companies that generally recognize revenue ratably over the contract term and may not permit rollover. Because customers have flexibility in the timing of their consumption, which can exceed their contracted capacity or extend beyond the original contract term in many cases, the amount of product revenue recognized in a given period is an important indicator of customer satisfaction and the value derived from our platform. While customer use of our platform in any period is not necessarily indicative of future use, we estimate future revenue using predictive models based on customers’ historical usage to plan and determine financial forecasts. Product revenue excludes our professional services and other revenue. Net Revenue Retention Rate. To calculate net revenue retention rate, we first specify a measurement period consisting of the trailing two years from our current period end. Next, we define as our measurement cohort the population of customers under capacity contracts that used our platform at any point in the first month of the first year of the measurement period. The cohorts used to calculate net revenue retention rate include end-customers under a reseller arrangement. We then calculate our net revenue retention rate as the quotient obtained by dividing our product revenue from this cohort in the second year of the measurement period by our product revenue from this cohort in the first year of the measurement period. Any customer in the cohort that did not use our platform in the second year remains in the calculation and contributes zero product revenue in the second year. Our net revenue retention rate is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our net revenue retention rate for historical periods reflecting these adjustments. Since we will continue to attribute the historical product revenue to the consolidated contract, consolidation of capacity contracts within a customer’s organization typically will not impact our net revenue retention rate unless one of those customers was not a customer at any point in the first month of the first year of the measurement period. Customers with Trailing 12-Month Product Revenue Greater than $1 Million. To calculate the number of customers with trailing 12-month product revenue greater than $1 million, we count the number of customers under capacity arrangements that contributed more than $1 million in product revenue in the trailing 12 months. For purposes of determining our customer count, we treat each customer account, including accounts for end-customers under a reseller arrangement, that has at least one corresponding capacity contract as a unique customer, and a single organization with multiple divisions, segments, or subsidiaries may be counted as multiple customers. We do not include customers that consume our platform only under on-demand arrangements for purposes of determining our customer count. Our customer count is subject to adjustments for acquisitions, consolidations, spin-offs, and other market activity, and we present our customer count for historical periods reflecting these adjustments. Forbes Global 2000 Customers. Our Forbes Global 2000 customer count is a subset of our customer count based on the 2026 Forbes Global 2000 list. Our Forbes Global 2000 customer count is subject to adjustments for annual updates to the list by Forbes, as well as acquisitions, consolidations, spin-offs, and other market activity with respect to such customers, and we present our Forbes Global 2000 customer count for historical periods reflecting these adjustments. Remaining Performance Obligations. Remaining performance obligations (RPO) represent the amount of contracted future revenue that has not yet been recognized, including (i) deferred revenue and (ii) non-cancelable contracted amounts that will be invoiced and recognized as revenue in future periods. RPO excludes performance obligations from on-demand arrangements and certain time and materials contracts that are billed in arrears. Portions of RPO that are not yet invoiced and are denominated in foreign currencies are revalued into U.S. dollars each period based on the applicable period-end exchange rates. RPO is not necessarily indicative of future product revenue growth because it does not account for the timing of customers’ consumption or their consumption of more than their contracted capacity. Moreover, RPO is influenced by a number of factors, including the timing and size of renewals, the timing and size of purchases of additional capacity, average contract terms, seasonality, changes in foreign currency exchange rates, and the extent to which customers are permitted to roll over unused capacity to future periods, generally upon the purchase of additional capacity at renewal. Due to these factors, it is important to review RPO in conjunction with product revenue and other financial metrics disclosed elsewhere herein. Use of Forward‑Looking Statements

This release and the accompanying oral presentation contain forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, regarding our performance, including but not limited to statements in the section titled “Financial Outlook.” Words such as “guidance,” “outlook,” “expect,” “anticipate,” “should,” “believe,” “hope,” “target,” “project,” “plan,” “goals,” “estimate,” “potential,” “predict,” “forecast,” “position,” “see,” “on track,” “may,” “will,” “might,” “could,” “intend,” “shall,” “future,” and variations of these terms or the negative of these terms and similar expressions are intended to identify these forward-looking statements. Other than statements of historical fact, all statements contained in this release and accompanying oral presentation are forward-looking statements, including statements regarding (i) our future operating results, targets, or financial position, including expectations regarding revenue recognition; (ii) our business strategy, plans, opportunities, or priorities, including with respect to strategic transactions; (iii) the release, adoption, and use of our new or enhanced products, services, and technology offerings, including those that are under development or not generally available; (iv) market size and growth, trends, and competitive considerations; (v) our vision, strategy, and expected benefits relating to artificial intelligence (AI), the enterprise AI revolution, Snowflake Cortex AI, Snowpark, Snowflake Marketplace, the AI Data Cloud, and AI Data Clouds for specific industries or product categories, including the expected benefits and network effects of the AI Data Cloud; and (vi) the integration, interoperability, and availability of our products, services, and technology offerings with and on third-party products and platforms, including public cloud platforms and AI models.

The forward-looking statements contained in this release and the accompanying oral presentation are subject to known and unknown risks, uncertainties, assumptions, and other factors that may cause actual results or outcomes to be materially different from any future results or outcomes expressed or implied by the forward-looking statements. These risks, uncertainties, assumptions, and other factors include, but are not limited to, those related to our business and financial performance; general market and business conditions, downturns, or uncertainty, including higher inflation, tariffs and trade wars, extended federal government shutdowns, higher interest rates, fluctuations or volatility in capital markets, energy markets, or foreign currency exchange rates, and geopolitical instability; our ability to attract and retain customers that use our platform to support their end-to-end data lifecycle; our ability to execute on our business strategy, including our strategy across our product categories and an effective AI strategy; our ability to respond rapidly and effectively to emerging technology trends, including the adoption and use of AI, and the extent to which our investments in new technologies are successful; the extent to which customers continue to optimize consumption, including with respect to AI features; our ability to compete effectively in a continually evolving market in which enterprises are increasingly adopting AI to perform core functions and significant disruption is being driven by AI; our ability to attract, recruit, and retain qualified personnel to support our operations and growth; the impact of new or optimized product features and pricing strategies on consumption, including AI credit pricing, Iceberg tables, tiered storage pricing, and adaptive warehouses; our ability to consummate and realize the anticipated benefits of any acquisitions, strategic investments, partnerships, or alliances; unforeseen technical, operational, or business challenges impacting the timing, scope, or success of strategic partnerships; the extent to which customers continue to rationalize budgets and prioritize cash flow management, including through shortened contract durations; our ability to develop new products and services and enhance existing products and services; the extent to which customer adoption of new product capabilities results in durable consumption; the growth of successful native applications on the Snowflake Marketplace; our ability to increase and predict customer consumption of our platform, particularly in light of the impact of holidays on customer consumption patterns; our ability to increase our penetration into existing markets and enter and grow new markets, including highly-regulated markets such as financial services, healthcare, and the public sector; the effectiveness of our security measures designed to protect against security incidents and the impact of cybersecurity threat activity directed at us or our customers and any resulting reputational or financial damage; success of our sales and marketing efforts and our ability to promote our brand; our ability to protect our intellectual property rights and the extent to which they provide us with a competitive advantage; our ability to manage growth; our ability to sublease or terminate certain of our office facility commitments and the impact of related asset impairment; the impact and timing of stock repurchases under our stock repurchase program; our ability to reduce stock-based compensation as a percentage of our revenue; our ability to achieve GAAP profitability; and our ability to meet the requirements of the Notes and the settlement timing and method for the Notes and the Capped Calls.

Further information on these and additional risks, uncertainties, assumptions, and other factors that could cause actual outcomes and results to differ materially from those included in or contemplated by the forward-looking statements contained in this release are included under the caption “Risk Factors” and elsewhere in our Form 10-Q for the fiscal quarter ended April 30, 2026 and other filings and reports we make with the Securities and Exchange Commission from time to time, including our Form 10-Q that will be filed for the fiscal quarter ended July 31, 2026.

Moreover, we operate in a very competitive and rapidly changing environment, and new risks may emerge from time to time. It is not possible to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor(s) may cause actual results or outcomes to differ materially from those contained in any forward-looking statements we may make. As a result of these risks, uncertainties, assumptions, and other factors, you should not rely on any forward-looking statements as predictions of future events. Forward-looking statements speak only as of the date the statements are made and are based on information available to us at the time those statements are made and/or management's good faith belief as of that time with respect to future events. Except as required by law, we undertake no obligation, and do not intend, to update these forward-looking statements, to review or confirm analysts’ expectations, or to provide interim reports or updates on the progress of the current financial quarter.

About Snowflake

Snowflake is the platform for the AI era, making it easy for enterprises to innovate faster and get more value from data. More than 14,500 customers around the globe, including hundreds of the world’s largest companies, use Snowflake’s AI Data Cloud to build, use and share data, applications and AI. With Snowflake, data and AI are transformative for everyone. Learn more at snowflake.com (NYSE: SNOW).

Source: Snowflake Inc.

Snowflake Inc.

Condensed Consolidated Statements of Operations

(in thousands, except per share data)

(unaudited)

  Three Months Ended July 31,

Six Months Ended July 31,

2026

2025

2026

2025

Revenue

$

1,546,793

$

1,144,969

$

2,937,744

$

2,187,043

Cost of revenue

510,075

371,815

974,575

720,601

Gross profit

1,036,718

773,154

1,963,169

1,466,442

Operating expenses:

Sales and marketing

611,615

501,957

1,200,567

960,511

Research and development

567,476

492,003

1,102,413

964,407

General and administrative

120,594

119,470

249,310

329,057

Total operating expenses

1,299,685

1,113,430

2,552,290

2,253,975

Operating loss

(262,967

)

(340,276

)

(589,121

)

(787,533

)

Interest income

41,996

49,467

83,141

102,630

Interest expense

(2,081

)

(2,074

)

(4,161

)

(4,145

)

Other income (expense), net

34,762

(4,985

)

25,191

(33,043

)

Loss before income taxes

(188,290

)

(297,868

)

(484,950

)

(722,091

)

Provision for income taxes

3,430

62

2,341

5,791

Net loss

(191,720

)

(297,930

)

(487,291

)

(727,882

)

Less: net income attributable to noncontrolling interest

—

87

—

227

Net loss attributable to Snowflake Inc.

$

(191,720

)

$

(298,017

)

$

(487,291

)

$

(728,109

)

Net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

$

(0.55

)

$

(0.89

)

$

(1.40

)

$

(2.18

)

Weighted-average shares used in computing net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

349,257

335,215

347,356

333,957

  Snowflake Inc.

Condensed Consolidated Balance Sheets

(in thousands)

(unaudited)

  July 31, 2026

January 31, 2026

Assets

Current assets:

Cash and cash equivalents

$

1,707,187

$

2,828,163

Short-term investments

637,508

1,201,523

Accounts receivable, net

718,464

1,303,740

Deferred commissions, current

222,084

214,058

Prepaid expenses and other current assets

208,593

195,128

Total current assets

3,493,836

5,742,612

Long-term investments

1,984,482

755,013

Property and equipment, net

207,981

248,611

Operating lease right-of-use assets

285,019

274,897

Goodwill

1,639,003

1,194,367

Intangible assets, net

426,527

246,916

Deferred commissions, non-current

222,581

241,759

Other assets

431,030

428,320

Total assets

$

8,690,459

$

9,132,495

Liabilities and Stockholders’ Equity

Current liabilities:

Accounts payable

$

185,250

$

145,559

Accrued expenses and other current liabilities

908,005

879,537

Operating lease liabilities, current

59,787

49,598

Deferred revenue, current

2,568,489

3,346,997

Total current liabilities

3,721,531

4,421,691

Convertible senior notes, net

2,283,985

2,279,827

Operating lease liabilities, non-current

420,043

411,689

Deferred revenue, non-current

27,756

14,440

Other liabilities

87,480

80,746

Stockholders’ equity

2,149,664

1,924,102

Total liabilities and stockholders’ equity

$

8,690,459

$

9,132,495

  Snowflake Inc.

Condensed Consolidated Statements of Cash Flows

(in thousands)

(unaudited)

  Three Months Ended July 31,

Six Months Ended July 31,

2026

2025

2026

2025

Cash flows from operating activities:

Net loss

$

(191,720

)

$

(297,930

)

$

(487,291

)

$

(727,882

)

Adjustments to reconcile net loss to net cash provided by operating activities:

Depreciation and amortization

68,629

54,837

136,234

103,641

Non-cash operating lease costs

17,669

16,156

35,551

33,998

Amortization of deferred commissions

59,743

33,158

117,473

58,954

Stock-based compensation, net of any amounts capitalized

423,582

404,217

826,052

783,677

Net accretion of discounts on investments

(1,081

)

(5,717

)

(3,286

)

(13,369

)

Net realized and unrealized losses (gains) on strategic investments

(34,755

)

5,580

(25,257

)

35,265

Amortization of debt issuance costs

2,081

2,074

4,161

4,145

Asset impairment related to office facility exits

112

2,131

17,836

108,619

Deferred income tax

(1,927

)

(3,445

)

(8,489

)

(3,445

)

Other

4,534

1,685

7,355

(3,489

)

Changes in operating assets and liabilities, net of effects of business combinations:

Accounts receivable

(146,587

)

(117,606

)

600,630

276,051

Deferred commissions

(69,521

)

(53,750

)

(106,320

)

(84,864

)

Prepaid expenses and other assets

22,104

(4,486

)

(351

)

(22,338

)

Accounts payable

130,904

11,771

41,231

7,348

Accrued expenses and other liabilities

108,847

93,291

28,056

97,226

Operating lease liabilities

(22,635

)

(14,559

)

(41,842

)

(26,397

)

Deferred revenue

(278,622

)

(52,511

)

(807,163

)

(323,871

)

Net cash provided by operating activities

91,357

74,896

334,580

303,269

Cash flows from investing activities:

Purchases of property and equipment

(7,554

)

(16,665

)

(18,005

)

(61,654

)

Cash paid for business combinations, net of cash, cash equivalents and restricted cash acquired

(1,992

)

(164,230

)

(254,449

)

(164,230

)

Purchases of intangible assets

—

(1,311

)

—

(1,311

)

Purchases of investments

(919,669

)

(636,469

)

(1,816,116

)

(1,649,044

)

Sales of investments

128,762

1,476

238,456

18,875

Maturities and redemptions of investments

451,016

517,947

896,186

1,502,129

Net cash used in investing activities

(349,437

)

(299,252

)

(953,928

)

(355,235

)

Cash flows from financing activities:

Proceeds from exercise of stock options

67,845

28,186

74,424

34,446

Proceeds from issuance of common stock under employee stock purchase plan

—

—

66,987

53,193

Taxes paid related to net share settlement of equity awards

(184,896

)

(161,999

)

(327,742

)

(294,497

)

Repurchases of common stock

—

—

(300,003

)

(490,638

)

Payments of deferred purchase consideration for business combinations

—

(226

)

(2,250

)

(600

)

Net cash used in financing activities

(117,051

)

(134,039

)

(488,584

)

(698,096

)

Effect of exchange rate changes on cash, cash equivalents, and restricted cash

(1,860

)

(175

)

(4,684

)

12,222

Net decrease in cash, cash equivalents, and restricted cash

(376,991

)

(358,570

)

(1,112,616

)

(737,840

)

Cash, cash equivalents, and restricted cash—beginning of period

2,128,678

2,319,408

2,864,303

2,698,678

Cash, cash equivalents, and restricted cash—end of period

$

1,751,687

$

1,960,838

$

1,751,687

$

1,960,838

  Snowflake Inc.

GAAP to Non-GAAP Reconciliations

(in thousands, except per share data and percentages)

(unaudited)

  Three Months Ended July 31,

Six Months Ended July 31,

2026

2025

2026

2025

Amount

Amount as a

% of Revenue

Amount

Amount as a

% of Revenue

Amount

Amount as a

% of Revenue

Amount

Amount as a

% of Revenue

Revenue:

Product revenue

$

1,491,861

96%

$

1,090,496

95%

$

2,826,190

96%

$

2,087,309

95%

Professional services and other revenue

54,932

4%

54,473

5%

111,554

4%

99,734

5%

Revenue

$

1,546,793

100%

$

1,144,969

100%

$

2,937,744

100%

$

2,187,043

100%

Year-over-year growth

35

%

32

%

34

%

29

%

Cost of revenue:

GAAP cost of product revenue

$

434,418

$

302,316

$

821,292

$

587,592

Adjustments:

Stock-based compensation-related charges

(31,217

)

(31,899

)

(62,863

)

(62,751

)

Amortization of acquired intangibles

(25,424

)

(13,552

)

(49,018

)

(25,287

)

Non-GAAP cost of product revenue

$

377,777

$

256,865

$

709,411

$

499,554

GAAP cost of professional services and other revenue

$

75,657

$

69,499

$

153,283

$

133,009

Adjustments:

Stock-based compensation-related charges

(14,663

)

(15,019

)

(29,259

)

(29,660

)

Amortization of acquired intangibles

(1,824

)

(1,663

)

(3,588

)

(3,271

)

Non-GAAP cost of professional services and other revenue

$

59,170

$

52,817

$

120,436

$

100,078

GAAP cost of revenue

$

510,075

33%

$

371,815

32%

$

974,575

33%

$

720,601

33%

Adjustments:

Stock-based compensation-related charges

(45,880

)

(46,918

)

(92,122

)

(92,411

)

Amortization of acquired intangibles

(27,248

)

(15,215

)

(52,606

)

(28,558

)

Non-GAAP cost of revenue

$

436,947

28%

$

309,682

27%

$

829,847

28%

$

599,632

27%

Gross profit (loss):

GAAP product gross profit

$

1,057,443

$

788,180

$

2,004,898

$

1,499,717

Adjustments:

Stock-based compensation-related charges

31,217

31,899

62,863

62,751

Amortization of acquired intangibles

25,424

13,552

49,018

25,287

Non-GAAP product gross profit

$

1,114,084

$

833,631

$

2,116,779

$

1,587,755

GAAP professional services and other revenue gross loss

$

(20,725

)

$

(15,026

)

$

(41,729

)

$

(33,275

)

Adjustments:

Stock-based compensation-related charges

14,663

15,019

29,259

29,660

Amortization of acquired intangibles

1,824

1,663

3,588

3,271

Non-GAAP professional services and other revenue gross profit (loss)

$

(4,238

)

$

1,656

$

(8,882

)

$

(344

)

GAAP gross profit

$

1,036,718

67%

$

773,154

68%

$

1,963,169

67%

$

1,466,442

67%

Adjustments:

Stock-based compensation-related charges

45,880

46,918

92,122

92,411

Amortization of acquired intangibles

27,248

15,215

52,606

28,558

Non-GAAP gross profit

$

1,109,846

72%

$

835,287

73%

$

2,107,897

72%

$

1,587,411

73%

Gross margin:

GAAP product gross margin

71

%

72

%

71

%

72

%

Adjustments:

Stock-based compensation-related charges as a % of product revenue

2

%

3

%

2

%

3

%

Amortization of acquired intangibles as a % of product revenue

2

%

1

%

2

%

1

%

Non-GAAP product gross margin

75

%

76

%

75

%

76

%

GAAP professional services and other revenue gross margin

(38

%)

(28

%)

(37

%)

(33

%)

Adjustments:

Stock-based compensation-related charges as a % of professional services and other revenue

27

%

28

%

26

%

30

%

Amortization of acquired intangibles as a % of professional services and other revenue

3

%

3

%

3

%

3

%

Non-GAAP professional services and other revenue gross margin

(8

%)

3

%

(8

%)

—

%

GAAP gross margin

67

%

68

%

67

%

67

%

Adjustments:

Stock-based compensation-related charges as a % of revenue

3

%

4

%

3

%

5

%

Amortization of acquired intangibles as a % of revenue

2

%

1

%

2

%

1

%

Non-GAAP gross margin

72

%

73

%

72

%

73

%

Operating expenses:

GAAP sales and marketing expense

$

611,615

40%

$

501,957

44%

$

1,200,567

41%

$

960,511

44%

Adjustments:

Stock-based compensation-related charges

(109,272

)

(100,528

)

(213,170

)

(193,439

)

Amortization of acquired intangibles

(12,923

)

(9,326

)

(26,131

)

(17,086

)

Non-GAAP sales and marketing expense

$

489,420

32%

$

392,103

34%

$

961,266

33%

$

749,986

35%

GAAP research and development expense

$

567,476

36%

$

492,003

44%

$

1,102,413

38%

$

964,407

44%

Adjustments:

Stock-based compensation-related charges

(256,303

)

(242,156

)

(504,932

)

(473,101

)

Amortization of acquired intangibles

(2,027

)

(2,723

)

(3,987

)

(5,368

)

Restructuring recoveries, net(1)

—

—

—

8

Non-GAAP research and development expense

$

309,146

20%

$

247,124

22%

$

593,494

20%

$

485,946

22%

GAAP general and administrative expense

$

120,594

8%

$

119,470

10%

$

249,310

8%

$

329,057

15%

Adjustments:

Stock-based compensation-related charges

(44,908

)

(46,580

)

(79,796

)

(85,953

)

Amortization of acquired intangibles

(32

)

(543

)

(64

)

(880

)

Expenses associated with acquisitions and strategic investments

(1,378

)

(2,191

)

(1,440

)

(2,569

)

Restructuring recoveries, net(1)

2

464

22

1,214

Asset impairment related to office facility exits, net of sublease income(2)

17

(2,132

)

(17,633

)

(108,620

)

Non-GAAP general and administrative expense

$

74,295

5%

$

68,488

6%

$

150,399

5%

$

132,249

6%

GAAP total operating expenses

$

1,299,685

84%

$

1,113,430

98%

$

2,552,290

87%

$

2,253,975

103%

Adjustments:

Stock-based compensation-related charges

(410,483

)

(389,264

)

(797,898

)

(752,493

)

Amortization of acquired intangibles

(14,982

)

(12,592

)

(30,182

)

(23,334

)

Expenses associated with acquisitions and strategic investments

(1,378

)

(2,191

)

(1,440

)

(2,569

)

Restructuring recoveries, net(1)

2

464

22

1,222

Asset impairment related to office facility exits, net of sublease income(2)

17

(2,132

)

(17,633

)

(108,620

)

Non-GAAP total operating expenses

$

872,861

57%

$

707,715

62%

$

1,705,159

58%

$

1,368,181

63%

Operating income (loss):

GAAP operating loss

$

(262,967

)

(17%)

$

(340,276

)

(30%)

$

(589,121

)

(20%)

$

(787,533

)

(36%)

Adjustments:

Stock-based compensation-related charges(3)

456,363

436,182

890,020

844,904

Amortization of acquired intangibles

42,230

27,807

82,788

51,892

Expenses associated with acquisitions and strategic investments

1,378

2,191

1,440

2,569

Restructuring recoveries, net(1)

(2

)

(464

)

(22

)

(1,222

)

Asset impairment related to office facility exits, net of sublease income(2)

(17

)

2,132

17,633

108,620

Non-GAAP operating income

$

236,985

15%

$

127,572

11%

$

402,738

14%

$

219,230

10%

Operating margin:

GAAP operating margin

(17

%)

(30

%)

(20

%)

(36

%)

Adjustments:

Stock-based compensation-related charges as a % of revenue

29

%

39

%

30

%

39

%

Amortization of acquired intangibles as a % of revenue

3

%

2

%

3

%

2

%

Expenses associated with acquisitions and strategic investments as a % of revenue

—

%

—

%

—

%

—

%

Restructuring recoveries, net as a % of revenue

—

%

—

%

—

%

—

%

Asset impairment related to office facility exits, net of sublease income as a % of revenue

—

%

—

%

1

%

5

%

Non-GAAP operating margin

15

%

11

%

14

%

10

%

Net income (loss):

GAAP net loss

$

(191,720

)

(12%)

$

(297,930

)

(26%)

$

(487,291

)

(17%)

$

(727,882

)

(33%)

Adjustments:

Stock-based compensation-related charges(3)

456,363

436,182

890,020

844,904

Amortization of acquired intangibles

42,230

27,807

82,788

51,892

Expenses associated with acquisitions and strategic investments

1,378

2,191

1,440

2,569

Restructuring recoveries, net(1)

(2

)

(464

)

(22

)

(1,222

)

Asset impairment related to office facility exits, net of sublease income(2)

(17

)

2,132

17,633

108,620

Amortization of debt issuance costs

2,081

2,074

4,161

4,145

Income tax effect related to the above adjustments and acquisitions

(75,005

)

(43,006

)

(125,426

)

(66,468

)

Non-GAAP net income

$

235,308

15%

$

128,986

11%

$

383,303

13%

$

216,558

10%

Net income (loss) attributable to Snowflake Inc.(4):

GAAP net loss attributable to Snowflake Inc.

$

(191,720

)

(12%)

$

(298,017

)

(26%)

$

(487,291

)

(17%)

$

(728,109

)

(33%)

Adjustments:

Stock-based compensation-related charges(3)

456,363

436,182

890,020

844,904

Amortization of acquired intangibles

42,230

27,807

82,788

51,892

Expenses associated with acquisitions and strategic investments

1,378

2,191

1,440

2,569

Restructuring recoveries, net(1)

(2

)

(464

)

(22

)

(1,222

)

Asset impairment related to office facility exits, net of sublease income(2)

(17

)

2,132

17,633

108,620

Amortization of debt issuance costs

2,081

2,074

4,161

4,145

Income tax effect related to the above adjustments and acquisitions

(75,005

)

(43,006

)

(125,426

)

(66,468

)

Adjustments attributable to noncontrolling interest, net of tax

—

390

—

243

Non-GAAP net income attributable to Snowflake Inc.

$

235,308

15%

$

129,289

11%

$

383,303

13%

$

216,574

10%

Net income (loss) per share attributable to Snowflake Inc. common stockholders—basic and diluted(4):

GAAP net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

$

(0.55

)

$

(0.89

)

$

(1.40

)

$

(2.18

)

Weighted-average shares used in computing GAAP net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

349,257

335,215

347,356

333,957

Non-GAAP net income per share attributable to Snowflake Inc. common stockholders—basic

$

0.67

$

0.38

$

1.10

$

0.65

Weighted-average shares used in computing non-GAAP net income per share attributable to Snowflake Inc. common stockholders—basic

349,257

335,215

347,356

333,957

Non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted

$

0.62

$

0.35

$

1.02

$

0.58

GAAP weighted-average shares used in computing GAAP net loss per share attributable to Snowflake Inc. common stockholders—basic and diluted

349,257

335,215

347,356

333,957

Add: Effect of potentially dilutive common stock equivalents

18,345

25,939

16,895

24,986

Add: Effect of convertible senior notes

14,603

14,603

14,603

14,603

Less: Effect of antidilutive impact of capped call transactions

(4,327

)

(3,374

)

(2,812

)

(2,074

)

Non-GAAP weighted-average shares used in computing non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted(5)

377,878

372,383

376,042

371,472

Free cash flow and adjusted free cash flow:

GAAP net cash provided by operating activities

$

91,357

6%

$

74,896

7%

$

334,580

11%

$

303,269

14%

Adjustments:

Purchases of property and equipment

(7,554

)

(16,665

)

(18,005

)

(61,654

)

Non-GAAP free cash flow

83,803

5%

58,231

5%

316,575

11%

241,615

11%

Adjustments:

Net cash paid on payroll tax-related items on employee stock transactions(6)

8,500

9,534

41,242

32,419

Non-GAAP adjusted free cash flow

$

92,303

6%

$

67,765

6%

$

357,817

12%

$

274,034

13%

Non-GAAP free cash flow margin

5

%

5

%

11

%

11

%

Non-GAAP adjusted free cash flow margin

6

%

6

%

12

%

13

%

GAAP net cash used in investing activities

$

(349,437

)

$

(299,252

)

$

(953,928

)

$

(355,235

)

GAAP net cash used in financing activities

$

(117,051

)

$

(134,039

)

$

(488,584

)

$

(698,096

)

(1) Restructuring recoveries, net represent recoveries on certain costs incurred by us in connection with a restructuring plan for a majority-owned subsidiary.

(2) Asset impairment related to office facility exits, net of sublease income for the six months ended July 31, 2025 primarily relates to our San Mateo office facility.

(3) Stock-based compensation-related charges included employer payroll tax-related expenses on employee stock transactions of approximately $23.6 million and $45.0 million for the three and six months ended July 31, 2026, respectively, and $22.2 million and $41.7 million for the three and six months ended July 31, 2025, respectively.

(4) Beginning with the fourth quarter of fiscal 2026, the Company no longer attributes a portion of GAAP and non-GAAP net income (loss) to noncontrolling interest as it no longer controls a majority-owned subsidiary. As such, for the three and six months ended July 31, 2026, the calculations of GAAP and non-GAAP basic and diluted net income (loss) per share attributable to common stockholders align with the methodologies used to calculate the corresponding metrics for Snowflake Inc. common stockholders.

(5) The non-GAAP weighted-average shares used in computing non-GAAP net income per share attributable to Snowflake Inc. common stockholders—diluted included (a) the effect of all potentially dilutive common stock equivalents (stock options, restricted stock units, and employee stock purchase rights under our 2020 Employee Stock Purchase Plan) and (b) the potential dilutive effect of shares issuable upon conversion of the Notes using the if-converted method, starting from the beginning of the period or the issuance date of the Notes, if later. The potential dilutive effect of outstanding restricted stock units with performance conditions not yet satisfied is included in the non-GAAP weighted-average number of diluted shares at forecasted attainment levels to the extent we believe it is probable that the performance conditions will be met. The potential dilutive effect of outstanding restricted stock units with market conditions is included in the non-GAAP weighted-average number of diluted shares to the extent market conditions are met.

(6) Amounts exclude employee payroll taxes on net share settlement of equity awards, which are reflected as financing cash outflows. For the three and six months ended July 31, 2026, the excluded amounts were $184.9 million and $327.7 million, respectively; for the three and six months ended July 31, 2025, the excluded amounts were $162.0 million and $294.5 million, respectively.

More News From Snowflake Inc.

ISSAQUAH, Wash., Sept. 02, 2026 (GLOBE NEWSWIRE) -- Costco Wholesale Corporation (“Costco” or the “Company”) (Nasdaq: COST) today reported net sales of $23.70 billion for the retail month of August, the four weeks ended August 30, 2026, an increase of 9.9 percent from $21.56 billion last year.

For the 16-week fourth quarter, the Company reported net sales of $93.9 billion, an increase of 11.3 percent compared to net sales of $84.4 billion last year.

For the 52-week fiscal year ended August 30, 2026, the Company reported net sales of $297.3 billion, an increase of 10.2 percent from $269.9 billion last year.

Comparable sales were as follows:

  4 Weeks 16 Weeks 52 Weeks  Retail Month Fourth Quarter Fiscal Year U.S.9.0% 10.7% 8.2% Canada4.0% 5.0% 7.8% Other International9.5% 7.0% 9.8%        Total Company8.4% 9.4% 8.4% 
Digitally-Enabled
17.9% 
19.5% 
20.9%        Comparable sales excluding the impacts from changes in gasoline prices and foreign exchange were as follows:

  4 Weeks 16 Weeks 52 Weeks  Retail Month Fourth Quarter Fiscal Year U.S.5.6% 7.2% 6.6% Canada2.8% 4.6% 6.7% Other International6.8% 6.2% 6.5%        Total Company5.4% 6.7% 6.6% 
Digitally-Enabled
17.9% 
19.8% 
20.7%        Labor Day in the U.S. and Canada will occur one week later this year. The shift negatively impacted August total and comparable sales by a little less than 75 bps.

Additional discussion of these results is available in a pre-recorded message. It can be accessed by visiting investor.costco.com (click on “Events & Presentations”). This message will be available through 4:00 p.m. (PT) on Wednesday, September 9, 2026.

Costco currently operates 939 warehouses, including 647 in the United States and Puerto Rico, 115 in Canada, 43 in Mexico, 37 in Japan, 29 in the United Kingdom, 20 in Korea, 15 in Australia, 14 in Taiwan, seven in China, five in Spain, three in France, two in Sweden, and one each in Iceland, and New Zealand. Costco also operates e-commerce sites in the U.S., Canada, the U.K., Mexico, Korea, Taiwan, Japan, Australia, and China.

Certain statements contained in this document and the pre-recorded message constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. For these purposes, forward-looking statements are statements that address activities, events, conditions or developments that the Company expects or anticipates may occur in the future. In some cases forward-looking statements can be identified because they contain words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “likely,” “may,” “might,” “plan,” “potential,” “predict,” “project,” “seek,” “should,” “target,” “will,” “would,” or similar expressions and the negatives of those terms. Such forward-looking statements involve risks and uncertainties that may cause actual events, results or performance to differ materially from those indicated by such statements. These risks and uncertainties include, but are not limited to, domestic and international economic conditions, including exchange rates, inflation or deflation, the effects of competition and regulation, uncertainties in the financial markets, consumer and small business spending patterns and debt levels, breaches of security or privacy of member or business information, conditions affecting the acquisition, development, ownership or use of real estate, capital spending, actions of vendors, rising costs associated with employees (generally including health-care costs and wages), workforce interruptions, energy and certain commodities, geopolitical conditions (including tariffs and global conflicts), the ability to maintain effective internal control over financial reporting, regulatory and other impacts related to environmental and social matters, public-health related factors, and other risks identified from time to time in the Company’s public statements and reports filed with the Securities and Exchange Commission. Forward-looking statements speak only as of the date they are made, and the Company does not undertake to update these statements, except as required by law. Comparable sales and comparable sales excluding impacts from changes in gasoline prices and foreign exchange are intended as supplemental information and are not a substitute for net sales presented in accordance with U.S. GAAP.

CONTACTS:Costco Wholesale Corporation
Josh Dahmen, 425/313-8254
Andrew Yoon, 425/313-6305
Bryan Starnes, 425/427-7403 COST-Sales

Revenue of $29.6 billion for the third quarter, up 86 percent from the prior year period GAAP operating income of $16.0 billion for the third quarter; Non-GAAP operating income of $20.1 billion for the third quarter GAAP diluted EPS of $2.68 for the third quarter; Non-GAAP diluted EPS of $3.32 for the third quarter Cash from operations of $14.2 billion for the third quarter, less capital expenditures of $0.5 billion, resulted in $13.7 billion of free cash flow, or 46 percent of revenue Quarterly common stock dividend of $0.65 per share Fourth quarter fiscal year 2026 revenue guidance of approximately $34.8 billion, an increase of 93 percent from the prior year period Fourth quarter fiscal year 2026 Non-GAAP operating income guidance of approximately 66 percent of projected revenue (1) , /PRNewswire/ -- Broadcom Inc. (Nasdaq: AVGO), a global technology leader that designs, develops and supplies semiconductor and infrastructure software solutions, today reported financial results for its third quarter of fiscal year 2026, ended August 2, 2026, provided guidance for its fourth quarter of fiscal year 2026 and announced its quarterly dividend.

"Demand for our custom AI accelerators and networking continues to be very strong. Q3 AI semiconductor revenue of $16.7 billion grew 221% year-over-year, and 54% quarter-over-quarter," said Hock Tan, President and CEO of Broadcom Inc. "In Q4 the momentum continues, and we expect AI semiconductor revenue to accelerate to $21.7 billion, up 236% year-over-year."

"Broadcom achieved record revenue, operating profit and free cash flow in Q3. We delivered non-GAAP operating income growth of 92% year-over-year, as consolidated revenue grew 86% year-over-year to $29.6 billion," said Amie Thuener, CFO of Broadcom Inc. "Q4 consolidated revenue growth is forecasted to increase 93% year-over-year to $34.8 billion, and we expect to maintain our non-GAAP operating margin at 66%, flat from a year ago."  

__________________________________________________________________________________________________________________________________

(1) The Company is not readily able to provide a reconciliation of projected non-GAAP financial measures presented to the relevant projected GAAP measures
without unreasonable effort.

Third Quarter Fiscal Year 2026 Financial Highlights

GAAP

Non-GAAP

(Dollars in millions, except per share data)

Q3 26

Q3 25

Change   

Q3 26

Q3 25

Change   

Net revenue

$

29,591

$

15,952

+86

%

$

29,591

$

15,952

+86

%

Operating income

$

15,955

$

5,887

+171

%

$

20,095

$

10,455

+92

%

Net income

$

13,088

$

4,140

+216

%

$

16,372

$

8,404

+95

%

Earnings per common share - diluted

$

2.68

$

0.85

+215

%

$

3.32

$

1.69

+96

%

(Dollars in millions)

Q3 26

Q3 25

Change   

Cash flow from operations                                                            

$

14,197

$

7,166

+98

%

Free cash flow

$

13,665

$

7,024

+95

%

Net revenue by segment

(Dollars in millions)

Q3 26

Q3 25

Change   

Semiconductor solutions                                                        

$

20,839

70

%

$

9,166

57

%

+127

%

Infrastructure software

8,752

30

6,786

43

+29

%

Total net revenue

$

29,591

100

%

$

15,952

100

%

The Company's cash and cash equivalents at the end of the fiscal quarter were $24.0 billion, compared to $19.6 billion at the end of the prior fiscal quarter.

During the third fiscal quarter, the Company generated $14.2 billion in cash from operations and spent $0.5 billion on capital expenditures, resulting in $13.7 billion of free cash flow.

On June 30, 2026, the Company paid a cash dividend of $0.65 per share, totaling $3.1 billion.

The differences between the Company's GAAP and non-GAAP results are described generally under "Non-GAAP Financial Measures" below and presented in detail in the financial reconciliation tables attached to this release.

Fourth Quarter Fiscal Year 2026 Business Outlook

Based on current business trends and conditions, the outlook for the fourth quarter of fiscal year 2026, ending November 1, 2026, is expected to be as follows:

Fourth quarter revenue guidance of approximately $34.8 billion; Fourth quarter non-GAAP operating income guidance of approximately 66 percent of projected revenue. The guidance provided above is only an estimate of what the Company believes is realizable as of the date of this release. The Company is not readily able to provide a reconciliation of projected non-GAAP financial measures to the relevant projected GAAP measures without unreasonable effort. Actual results will vary from the guidance and the variations may be material. The Company undertakes no intent or obligation to publicly update or revise any of these projections, whether as a result of new information, future events or otherwise, except as required by law.

Quarterly Dividends

The Board of Directors of Broadcom has approved a quarterly cash dividend of $0.65 per share. The dividend is payable on September 30, 2026 to stockholders of record at the close of business (5:00 p.m. Eastern Time) on September 21, 2026.

Financial Results Conference Call

Broadcom Inc. will host a conference call to review its financial results for the third quarter of fiscal year 2026 and to discuss the business outlook today at 2:00 p.m. Pacific Time.

To Listen via Internet: The conference call can be accessed live online in the Investors section of the Broadcom website at https://investors.broadcom.com/.

Replay: An audio replay of the conference call can be accessed for one year through the Investors section of Broadcom's website at https://investors.broadcom.com/.

Non-GAAP Financial Measures

The non-GAAP measures should not be considered as a substitute for, or superior to, measures of financial performance prepared in accordance with GAAP. When possible, a reconciliation between GAAP and non-GAAP financial data is included in the supplemental financial data attached to this press release. The Company is not readily able to provide a reconciliation of projected non-GAAP measures to the comparable GAAP measures without unreasonable effort. Broadcom believes non-GAAP financial information provides additional insight into the Company's on-going performance. Therefore, Broadcom provides this information to investors for a more consistent basis of comparison and to help them evaluate the results of the Company's on-going operations and enable more meaningful period to period comparisons.   

In addition to GAAP reporting, Broadcom provides investors with net income, operating income, gross margin, operating expenses, cash flow and other data on a non-GAAP basis. This non-GAAP information excludes amortization of acquisition-related intangible assets, stock-based compensation expense, restructuring and other charges, acquisition-related costs, including integration costs, non-GAAP tax reconciling adjustments, and other adjustments. Management does not believe that these items are reflective of the Company's underlying performance. Internally, these non-GAAP measures are significant measures used by management for purposes of evaluating the core operating performance of the Company, establishing internal budgets, calculating return on investment for development programs and growth initiatives, comparing performance with internal forecasts and targeted business models, strategic planning, evaluating and valuing potential acquisition candidates and how their operations compare to the Company's operations, and benchmarking performance externally against the Company's competitors. The exclusion of these and other similar items from Broadcom's non-GAAP financial results should not be interpreted as implying that these items are non-recurring, infrequent or unusual.

Free cash flow measures have limitations as they omit certain components of the overall cash flow statement and do not represent the residual cash flow available for discretionary expenditures. Investors should not consider presentation of free cash flow measures as implying that stockholders have any right to such cash. Broadcom's free cash flow may not be calculated in a manner comparable to similarly named measures used by other companies.

About Broadcom

Broadcom Inc. (NASDAQ: AVGO) is a technology leader that designs, develops, and supplies semiconductors and infrastructure software for global organizations' complex, mission-critical needs. Broadcom combines long-term R&D investment with superb execution to deliver the best technology, at scale. Broadcom is a Delaware corporation headquartered in Palo Alto, CA. For more information, visit www.broadcom.com.

Cautionary Note Regarding Forward-Looking Statements

This announcement contains forward-looking statements (including within the meaning of Section 21E of the United States Securities Exchange Act of 1934, as amended, and Section 27A of the United States Securities Act of 1933, as amended) concerning Broadcom. These statements include, but are not limited to, statements that address our expected future business and financial performance, our plans and expectations with regard to our share repurchases, and other statements identified by words such as "will," "expect," "believe," "anticipate," "estimate," "should," "intend," "plan," "potential," "predict," "project," "aim," and similar words, phrases or expressions. These forward-looking statements are based on current expectations and beliefs of Broadcom's management, current information available to Broadcom's management, and current market trends and market conditions and involve risks and uncertainties that may cause actual results to differ materially from those contained in these forward-looking statements. Accordingly, undue reliance should not be placed on such statements.

Particular uncertainties that could materially affect future results include risks associated with: global economic conditions and uncertainty; government regulations, trade restrictions and trade tensions; global political and economic conditions relating to our international operations; cyclicality in the semiconductor industry undergoing profound change due to AI; any loss of our significant customers and fluctuations in the timing and volume of significant customer demand; the slow or unsuccessful return on our research and development investments, expansion of our business strategy or adoption of new business models; our dependence on contract manufacturing and outsourced supply chain; our dependency on a limited number of suppliers; our ability to continue winning business in the semiconductor solutions industry; our ability to accurately estimate customers' demand and adjust our manufacturing and supply chain accordingly; dependence on senior management and our ability to attract and retain qualified personnel; our ability to maintain or improve gross margin; our ability to protect against cybersecurity threats and a breach of security systems; prolonged disruptions of our, our customers' or our suppliers' facilities or other significant operations; our ability to maintain appropriate manufacturing capacity and quality; dependence on and risks associated with distributors and other channel partners of our products; ability of our software portfolio to manage and secure IT infrastructures and environments; demand for our data center virtualization products and customer acceptance of our software, services and business strategy; competitiveness of our software solutions and compatibility of our software with operating environments, platforms or third-party products; our ability to enter into satisfactory software license agreements; use of open source software in our software and services; sales to government customers; our ability to manage our software solutions and services lifecycles; our competitive performance; quarterly and annual fluctuations in operating results; any acquisitions or dispositions we may make, such as delays, challenges and expenses associated with receiving governmental and regulatory approvals and satisfying other closing conditions, and with integrating acquired businesses with our existing businesses and our ability to achieve the benefits, growth prospects and synergies expected by such acquisitions; involvement in legal proceedings; our ability to protect our intellectual property and the unpredictability of any associated litigation expenses; any expenses or reputational damage associated with resolving customer product warranty and indemnification claims, or other undetected defects or bugs; our compliance with privacy and data security laws; corporate responsibility matters; our provision for income taxes and overall cash tax costs; our ability to maintain tax concessions in certain jurisdictions; potential tax liabilities as a result of acquiring VMware; our significant indebtedness and the need to generate sufficient cash flows to service and repay such debt; the amount and frequency of our share repurchase program; and other events and trends on a national, regional, industry-specific and global scale, including those of a political, economic, business, competitive and regulatory nature.

Our filings with the SEC, which are available without charge at the SEC's website at https://www.sec.gov, discuss some of the important risk factors that may affect our business, results of operations and financial condition. Actual results may vary from the estimates provided. We undertake no intent or obligation to publicly update or revise any of the estimates and other forward-looking statements made in this announcement, whether as a result of new information, future events or otherwise, except as required by law.

Contact:
Ji Yoo
Broadcom Inc.
Investor Relations
650-427-6000
[email protected]

(AVGO-Q)

 BROADCOM INC. 

 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS - UNAUDITED 

 (IN MILLIONS, EXCEPT PER SHARE DATA) 

 Fiscal Quarter Ended 

Three Fiscal Quarters Ended 

 August 2, 

 May 3, 

August 3,

 August 2, 

 August 3, 

2026

2026

2025

2026

2025

Net revenue

$

29,591

$

22,187

$

15,952

$

71,089

$

45,872

Cost of revenue:

Cost of revenue

7,624

5,301

3,704

17,604

10,273

Amortization of acquisition-related intangible assets

1,499

1,461

1,519

4,422

4,486

Restructuring charges

12

10

26

35

68

Total cost of revenue

9,135

6,772

5,249

22,061

14,827

Gross margin

20,456

15,415

10,703

49,028

31,045

Research and development

2,895

2,995

3,050

8,855

7,996

Selling, general and administrative

996

1,055

1,072

3,070

3,104

Amortization of acquisition-related intangible assets

507

506

507

1,520

1,524

Restructuring and other charges

103

71

187

277

445

Total operating expenses

4,501

4,627

4,816

13,722

13,069

Operating income

15,955

10,788

5,887

35,306

17,976

Interest expense

(778)

(776)

(807)

(2,355)

(2,449)

Other income, net

98

118

205

649

333

Income before income taxes

15,275

10,130

5,285

33,600

15,860

Provision for income taxes

2,187

820

1,145

3,853

1,252

Net income

$

13,088

$

9,310

$

4,140

$

29,747

$

14,608

Net income per share:

Basic

$

2.75

$

1.96

$

0.88

$

6.26

$

3.10

Diluted

$

2.68

$

1.91

$

0.85

$

6.09

$

3.02

Weighted-average shares used in per share calculations:

Basic

4,766

4,747

4,714

4,752

4,705

Diluted

4,887

4,876

4,860

4,884

4,841

Stock-based compensation expense:

Cost of revenue

$

224

$

223

$

251

$

683

$

607

Research and development

1,344

1,395

1,573

4,186

3,564

Selling, general and administrative

451

474

498

1,418

1,202

Total stock-based compensation expense

$

2,019

$

2,092

$

2,322

$

6,287

$

5,373

 BROADCOM INC. 

 FINANCIAL RECONCILIATION: GAAP TO NON-GAAP - UNAUDITED 

 (IN MILLIONS) 

 Fiscal Quarter Ended 

 Three Fiscal Quarters Ended 

 August 2, 

 May 3, 

 August 3, 

 August 2, 

 August 3, 

2026

2026

2025

2026

2025

Gross margin on GAAP basis

$

20,456

$

15,415

$

10,703

$

49,028

$

31,045

Amortization of acquisition-related intangible assets

1,499

1,461

1,519

4,422

4,486

Stock-based compensation expense

224

223

251

683

607

Restructuring charges

12

10

26

35

68

Gross margin on non-GAAP basis

$

22,191

$

17,109

$

12,499

$

54,168

$

36,206

Research and development on GAAP basis

$

2,895

$

2,995

$

3,050

$

8,855

$

7,996

Stock-based compensation expense

1,344

1,395

1,573

4,186

3,564

Research and development on non-GAAP basis

$

1,551

$

1,600

$

1,477

$

4,669

$

4,432

Selling, general and administrative expense on GAAP basis

$

996

$

1,055

$

1,072

$

3,070

$

3,104

Stock-based compensation expense

451

474

498

1,418

1,202

Acquisition-related costs

-

-

7

2

204

Selling, general and administrative expense on non-GAAP basis

$

545

$

581

$

567

$

1,650

$

1,698

Total operating expenses on GAAP basis

$

4,501

$

4,627

$

4,816

$

13,722

$

13,069

Amortization of acquisition-related intangible assets

507

506

507

1,520

1,524

Stock-based compensation expense

1,795

1,869

2,071

5,604

4,766

Restructuring and other charges

103

71

187

277

445

Acquisition-related costs

-

-

7

2

204

Total operating expenses on non-GAAP basis

$

2,096

$

2,181

$

2,044

$

6,319

$

6,130

Operating income on GAAP basis

$

15,955

$

10,788

$

5,887

$

35,306

$

17,976

Amortization of acquisition-related intangible assets

2,006

1,967

2,026

5,942

6,010

Stock-based compensation expense

2,019

2,092

2,322

6,287

5,373

Restructuring and other charges

115

81

213

312

513

Acquisition-related costs

-

-

7

2

204

Operating income on non-GAAP basis

$

20,095

$

14,928

$

10,455

$

47,849

$

30,076

Interest expense on GAAP basis

$

(778)

$

(776)

$

(807)

$

(2,355)

$

(2,449)

Loss on debt extinguishment

75

31

53

161

118

Interest expense on non-GAAP basis

$

(703)

$

(745)

$

(754)

$

(2,194)

$

(2,331)

Other income, net on GAAP basis

$

98

$

118

$

205

$

649

$

333

Excise tax benefit

-

-

-

(315)

-

Gain from sale of business

-

-

(163)

-

(163)

Other

-

-

29

-

8

Other income, net on non-GAAP basis

$

98

$

118

$

71

$

334

$

178

Provision for income taxes on GAAP basis

$

2,187

$

820

$

1,145

$

3,853

$

1,252

Non-GAAP tax reconciling adjustments

931

1,407

223

3,505

2,657

Provision for income taxes on non-GAAP basis

$

3,118

$

2,227

$

1,368

$

7,358

$

3,909

Net income on GAAP basis

$

13,088

$

9,310

$

4,140

$

29,747

$

14,608

Amortization of acquisition-related intangible assets

2,006

1,967

2,026

5,942

6,010

Stock-based compensation expense

2,019

2,092

2,322

6,287

5,373

Restructuring and other charges

115

81

213

312

513

Acquisition-related costs

-

-

7

2

204

Loss on debt extinguishment

75

31

53

161

118

Excise tax benefit

-

-

-

(315)

-

Gain from sale of business

-

-

(163)

-

(163)

Other

-

-

29

-

8

Non-GAAP tax reconciling adjustments

(931)

(1,407)

(223)

(3,505)

(2,657)

Net income on non-GAAP basis

$

16,372

$

12,074

$

8,404

$

38,631

$

24,014

Weighted-average shares used in per share calculations - diluted on GAAP basis

4,887

4,876

4,860

4,884

4,841

Non-GAAP adjustment (1)

50

64

112

61

94

Weighted-average shares used in per share calculations - diluted on non-GAAP basis               ‌

4,937

4,940

4,972

4,945

4,935

Net cash provided by operating activities

$

14,197

$

10,493

$

7,166

$

32,950

$

19,834

Purchases of property, plant and equipment

(532)

(231)

(142)

(1,013)

(386)

Free cash flow

$

13,665

$

10,262

$

7,024

$

31,937

$

19,448

________________________________________________________________________________________________________________________________________________

(1) Non-GAAP adjustment for the number of shares used in the diluted per share calculations excludes the impact of stock-based compensation expense expected to be incurred
in future periods and not yet recognized in the financial statements, which would otherwise be assumed to be used to repurchase shares under the GAAP treasury stock method.

BROADCOM INC.

CONDENSED CONSOLIDATED BALANCE SHEETS - UNAUDITED

(IN MILLIONS)

August 2,

November 2,

2026

2025

ASSETS

Current assets:

Cash and cash equivalents

$

23,975

$

16,178

Trade accounts receivable, net

13,707

7,145

Inventory

4,523

2,270

Other current assets

9,968

5,980

Total current assets

52,173

31,573

Long-term assets:

Property, plant and equipment, net

3,144

2,530

Goodwill

97,801

97,801

Intangible assets, net

26,325

32,273

Other long-term assets

8,705

6,915

Total assets

$

188,148

$

171,092

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable

$

4,000

$

1,560

Employee compensation and benefits

1,506

2,129

Short-term debt

2,252

3,152

Other current liabilities

13,080

11,673

Total current liabilities

20,838

18,514

Long-term liabilities:

Long-term debt

57,167

61,984

Other long-term liabilities

10,453

9,302

Total liabilities

88,458

89,800

Stockholders' equity:

Preferred stock

-

-

Common stock

5

5

Additional paid-in capital

77,330

71,308

Retained earnings

22,151

9,761

Accumulated other comprehensive income                    ‌

204

218

Total stockholders' equity

99,690

81,292

  Total liabilities and equity

$

188,148

$

171,092

 BROADCOM INC. 

 CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS - UNAUDITED 

 (IN MILLIONS) 

 Fiscal Quarter Ended 

 Three Fiscal Quarters Ended 

 August 2, 

 May 3, 

 August 3, 

 August 2, 

 August 3, 

2026

2026

2025

2026

2025

Cash flows from operating activities:

Net income

$

13,088

$

9,310

$

4,140

$

29,747

$

14,608

Adjustments to reconcile net income to net cash provided by operating activities:               ‌

Amortization of intangible and right-of-use assets

2,042

2,002

2,060

6,047

6,116

Depreciation

171

163

142

484

426

Stock-based compensation

2,019

2,092

2,322

6,287

5,373

Deferred taxes and other non-cash taxes

7

(603)

284

(1,051)

(983)

Loss on debt extinguishment

75

31

53

161

118

Non-cash interest expense

65

67

82

204

273

Other

13

3

(23)

31

58

Changes in assets and liabilities, net of acquisitions and disposals:

  Trade accounts receivable, net

(2,859)

(2,370)

(937)

(6,544)

(2,066)

  Inventory

(195)

(1,366)

(163)

(2,253)

(420)

  Accounts payable

1,630

149

136

2,313

(236)

  Employee compensation and benefits

372

270

511

(619)

(110)

  Other current assets and current liabilities

(2,675)

474

(999)

(2,893)

(1,028)

  Other long-term assets and long-term liabilities

444

271

(442)

1,036

(2,295)

Net cash provided by operating activities

14,197

10,493

7,166

32,950

19,834

Cash flows from investing activities:

Proceeds from sale of business

-

-

300

-

300

Purchases of property, plant and equipment

(532)

(231)

(142)

(1,013)

(386)

Purchases of investments

(619)

(23)

(99)

(756)

(261)

Sales of investments

37

39

51

320

147

Other

1

7

(16)

13

(13)

Net cash provided by (used in) investing activities

(1,113)

(208)

94

(1,436)

(213)

Cash flows from financing activities:

Proceeds from long-term borrowings

-

-

6,960

4,474

10,695

Payments on debt obligations

(5,628)

(1,250)

(6,750)

(10,528)

(14,840)

Proceeds from (repayments of) commercial paper, net

-

-

(3,373)

-

488

Payments of dividends

(3,103)

(3,092)

(2,786)

(9,281)

(8,345)

Repurchases of common stock - repurchase program

-

(600)

-

(8,450)

(2,450)

Shares repurchased for tax withholdings on vesting of equity awards

-

-

(58)

-

(3,860)

Issuance of common stock

-

113

-

113

118

Other

(6)

(2)

(7)

(45)

(57)

Net cash used in financing activities

(8,737)

(4,831)

(6,014)

(23,717)

(18,251)

Net change in cash and cash equivalents

4,347

5,454

1,246

7,797

1,370

Cash and cash equivalents at beginning of period

19,628

14,174

9,472

16,178

9,348

Cash and cash equivalents at end of period

$

23,975

$

19,628

$

10,718

$

23,975

$

10,718

Supplemental disclosure of cash flow information:

Cash paid for interest

$

674

$

695

$

602

$

1,988

$

1,973

Cash paid for income taxes

$

347

$

1,099

$

822

$

2,228

$

1,834

SOURCE Broadcom Inc.

BOSTON & OAKLAND, Calif.--(BUSINESS WIRE)--State Street Investment Management today announced the launch of the State Street® SPDR® UC Investments 90/10 Endowment Strategy Index ETF (“UCBG”), a new asset allocation ETF developed in collaboration with UC Investments (“UC”), the investment arm of the University of California and the index provider for the fund. The launch is backed by a $2.5 billion investment from UC, making it the largest ever U.S.-listed ETF launch.1

The fund seeks to track the UC Investments 90/10 Endowment Strategy Index, which combines broad U.S. equity exposure with short-duration investment-grade corporate bond exposure. The index allocates 90% of its weight to the S&P 500® Index, representing large-cap U.S. equities, and 10% to the S&P U.S. Investment Grade Corporate Bond 1-3 Year Index, which includes U.S. dollar-denominated investment-grade corporate bonds with maturities between one and three years.

UC and S&P Dow Jones Indices developed the custom index, which was inspired by UC’s $7.9 billion Blue and Gold Endowment Pool, a long-term public markets strategy that since its inception seven years ago, has been the best performing product within UC’s $236 billion investment portfolio.2 The strategy reflects UC’s conviction that low-cost, liquid, diversified public markets exposure can deliver compelling long-term returns while avoiding the complexity and illiquidity of traditional endowment models.

By bringing this philosophy into an ETF wrapper, UCBG offers long-term investors access to UC’s approach, which was previously available only within the institution’s portfolio and directly to employees of its 10 campuses and six medical centers through its retirement savings program, the nation’s second-largest public defined contribution program, behind only the federal government.

“At UC Investments, we focus on building long term, cost-effective portfolios to support our hundreds of thousands of UC students, faculty, staff, and alumni for generations to come,” said Jagdeep Singh Bachher, the University of California’s Chief Investment Officer. “This record-breaking ETF launch makes our institutional investment philosophy available to a broader community of investors through the transparency, efficiency and accessibility of the ETF structure, while staying true to the principles that have guided our investment approach.”

The ETF builds on State Street’s longstanding relationship with UC Investments. Today, State Street Investment Management provides asset management services to UC Investments’ $236 billion3 portfolio across pension, endowment, and other assets, while State Street Bank and Trust Company provides custody and other investment services.

"Our relationship with UC Investments spans more than two decades and has always been driven by innovation. With this launch, we are bringing an endowment-inspired strategy to a far broader range of investors, delivered with the low cost and transparency that make ETFs so powerful," said Ronald O'Hanley, Chairman and Chief Executive Officer of State Street Corporation.

“This partnership demonstrates what’s possible when a leading asset owner and asset manager work together to turn a successful institutional investment strategy into an accessible solution for investors,” said Yie-Hsin Hung, President and Chief Executive Officer of State Street Investment Management. “It reflects our commitment to helping clients extend their investment priorities to new markets and investor communities.”

About State Street Investment Management

At State Street Investment Management, we have been helping create better outcomes for institutions, financial intermediaries, and investors for nearly half a century. Starting with our early innovations in indexing and ETFs, our rigorous approach continues to be driven by market-tested expertise and a relentless commitment to those we serve. With over $6 trillion in assets managed*, clients in 60 countries, and a global network of strategic partners, we use our scale to deliver a comprehensive and cost-effective suite of investment solutions that help investors get wherever they want to go.

*This figure is presented as of June 30, 2026 and includes ETF AUM of $2,203.98 billion USD of which approximately $156.81 billion USD in gold assets with respect to SPDR products for which State Street Global Advisors Funds Distributors, LLC (SSGA FD) acts solely as the marketing agent. SSGA FD and State Street Investment Management are affiliated. Please note all AUM is unaudited.

About UC Investments

UC Investments manages the University of California’s retirement, endowment, working capital, and cash assets. Serving students, alumni, faculty, and staff, UC Investments provides fiduciary oversight and long-term stewardship of the university’s $236 billion investment portfolio. Visit here for more.

Important Risk Information

State Street Global Advisors (SSGA) is now State Street Investment Management. Please click here for more information.

Investing involves risk including the risk of loss of principal.

The Index is not intended to replicate the exact asset allocation of any endowment pool of UC Investments and, therefore, the Fund’s returns may differ from the returns of UC Investments' endowment pools.

ETFs trade like stocks, are subject to investment risk, fluctuate in market value and may trade at prices above or below the ETFs net asset value. Brokerage commissions and ETF expenses will reduce returns.

While the shares of ETFs are tradable on secondary markets, they may not readily trade in all market conditions and may trade at significant discounts in periods of market stress.

Equity securities may fluctuate in value and can decline significantly in response to the activities of individual companies and general market and economic conditions.

Funds managed with an index investment strategy attempt to track the performance of an unmanaged index of securities, regardless of the current or projected performance of the index or of the actual securities comprising the index. This differs from an actively managed fund, which typically seeks to outperform a benchmark index. As a result, the performance of a fund managed with an index investment strategy may be less favorable than if such fund employed an active strategy. While a fund managed with an index investment strategy seeks to track the performance of an index as closely as possible, the fund’s return may not match or achieve a high degree of correlation with the return of the index due to operating expenses, transaction costs, and cash flows.

Returns on investments in stocks of large companies could trail the returns on investments in stocks of smaller and mid-sized companies.

Debt Securities Risk: The value of the debt securities may increase or decrease as a result of the following: market fluctuations, changes in interest rates, inability of issuers to repay principal and interest or illiquidity in the debt securities markets.

Income Risk: The Fund's income may decline due to falling interest rates or other factors. Issuers of securities held by the Fund may call or redeem the securities during periods of falling interest rates, and the Fund would likely be required to reinvest in securities paying lower interest rates. If an obligation held by the Fund is prepaid, the Fund may have to reinvest the prepayment in other obligations paying income at lower rates. A reduction in the income earned by the Fund may limit the Fund's ability to achieve its objective.

Market Risk: The Fund’s investments are subject to changes in general economic conditions, general market fluctuations and the risks inherent in investment in securities markets. Investment markets can be volatile, and prices of investments can change substantially due to various factors, including, but not limited to, economic growth or recession, changes in interest rates, inflation, changes in the actual or perceived creditworthiness of issuers, and general market liquidity. The Fund is subject to the risk that geopolitical events will disrupt securities markets and adversely affect global economies and markets. Local, regional or global events such as war, military conflicts, acts of terrorism, trade policy changes or disputes, the threat or actual imposition of tariffs, natural disasters, the spread of infectious illness or other public health issues, or other events could have a significant impact on the Fund and its investments.

Intellectual Property Information: The S&P 500® Index is a product of S&P Dow Jones Indices LLC or its affiliates (“S&P DJI”) and have been licensed for use by State Street Global Advisors. S&P®, SPDR®, S&P 500®, US 500 and the 500 are trademarks of Standard & Poor’s Financial Services LLC (“S&P”); Dow Jones® is a registered trademark of Dow Jones Trademark Holdings LLC (“Dow Jones”) and has been licensed for use by S&P Dow Jones Indices; and these trademarks have been licensed for use by S&P DJI and sublicensed for certain purposes by State Street Global Advisors. The fund is not sponsored, endorsed, sold or promoted by S&P DJI, Dow Jones, S&P, their respective affiliates, and none of such parties make any representation regarding the advisability of investing in such product(s) nor do they have any liability for any errors, omissions, or interruptions of these indices.

Distributor: State Street Global Advisors Funds Distributors, LLC, member FINRA, SIPC, an indirect wholly owned subsidiary of State Street Corporation. References to State Street may include State Street Corporation and its affiliates. Certain State Street affiliates provide services and receive fees from the SPDR ETFs.

Before investing, consider the funds’ investment objectives, risks, charges and expenses. To obtain a prospectus or summary prospectus which contains this and other information, call 1-866-787-2257 or visit statestreet.com/im. Read it carefully.

Not FDIC insured. No bank guarantee. May lose value.

© 2026 State Street Corporation. All Rights Reserved.

State Street Investment Management, One Congress Street, Boston, MA 02114

9085584.1.2.AM.RTL
Expiration date: 9/30/2027

Key Takeaways Dell's Q2 EPS smashed Wall Street consensus estimates by 41%.The company is on track to double revenue and EPS by 2028.Unlike many AI peers, Dell has demonstrated market resilience recently. Dell Blows Away Wall Street ExpectationsTuesday night, Zacks Rank #1 (Strong Buy) stock Dell Technologies ((DELL - Free Report) ) delivered arguably the most impressive earnings report this quarter. Dell reported earnings per share of $7.04, trouncing the Zacks Consensus Estimate $4.97 by 41.65%. Meanwhile, positive earnings surprises are nothing new to Dell investors. The AI leader has beaten Zacks Consensus Estimates in 18 of the past 20 quarters.

Image Source: Zacks Investment Research

Why Dell’s Earnings Were So StrongDell Technologies is a leading global IT infrastructure and enterprise hardware provider. Although Dell is best-known as a legacy PC manufacturer, the company has benefited dramatically from the artificial intelligence buildout. In fact, in the second-quarter, Dell notched several records including, record revenue, record AI server revenue, record traditional server/networking revenue, record storage revenue, and record operating income. Overall revenue jumped 89% year over year. Meanwhile traditional server and networking revenue exploded 122%, while AI-optimized server revenue doubled year over year.

Why Dell’s Earnings Will Continue to Be StrongAlthough Dell’s Q2 growth was staggering, it’s likely just beginning. On the earnings call, management raised the company’s outlook and said: “Inference is past training and is pure demand in our industry. We think the tokens that inference drives is going to grow 87 times to 3600 quadrillion tokens by 2030. Training demand grows five x to 850 Z flops by 2030. Enterprise Agentic is expected to be the single largest workload by 2028. We’re expecting AI to be 75% of all data center demand by 2030.”

Meanwhile, Wall Street analysts echo management’s bullish sentiment. Zacks Consensus Analyst Estimates suggest that revenue and earnings per share will again double by 2028, continuing the company’s hockey-stick like growth trajectory.

Image Source: Zacks Investment Research

Dell Technical View: Relative Strength Vs. AI PeersWhile most AI leaders fell below their 50-day moving averages in July and August, Dell shares held the level. In fact, DELL has held the 50-day moving average since February and is once again testing it here.

Image Source: Zacks Investment Research

Bottom Line

Dell’s latest earnings results prove that its transformation from a legacy PC manufacturer to a core AI infrastructure provider. For long-term growth investors looking to capitalize on the next era of data center expansion, Dell continues to prove why it stands out as a market leader.

2nd Consecutive Quarter of Positive Comparable Sales Growth

Delivered Q2 Profitability Ahead of Outlook

Announces $75 Million Debt Prepayment, Progressing Toward 2x Leverage1Target

Reaffirms Fiscal 2026 Outlook

, /PRNewswire/ -- Petco (Nasdaq: WOOF), the retailer "where the pets go" to find everything they need to live their best lives, today reported its second quarter 2026 financial results.

Joel Anderson, Chief Executive Officer of Petco, stated, "We delivered stronger than expected profitability in the quarter while achieving our second consecutive quarter of positive comps. We were pleased to see growth in consumables, which highlights that our 'Reach for the Sky' strategy is gaining traction. Looking ahead to the second half, we are positioned to benefit from several growth drivers and are pleased to reaffirm our full-year sales and profitability outlook. We remain confident in our ability to generate sustainable, long-term growth." 

Q2 2026 Overview

In the second quarter of 2026, the Company received substantially all IEEPA tariff refunds related to tariffs paid under IEEPA in 2025 and 2026. All results below include a net benefit of $6.8 million related to such refunds, representing the proceeds net of investments to propel the repositioning of new assortments for future growth, and to a lesser degree, offset incremental fuel and tariff expense in Q2.

For the second quarter of 2026 compared to the second quarter of 2025:

Net sales of $1.5 billion increased 0.05%; comparable sales increased 0.6%. These results reflect a sales disruption from the initial stronger-than-expected points redemption from our membership program relaunch. Prior to the relaunch, sales were trending ahead of our Q2 outlook. Gross profit increased to $591.1 million; gross margin rate increased 37 basis points to 39.7% of net sales, compared to $585.3 million or 39.3% of net sales last year. Without the net benefit from the tariff refund, normalized gross margin was about flat with the prior year. Operating income increased 11.1% to $47.8 million compared to $43.0 million last year; operating margin increased 32 basis points to 3.2% compared to 2.9% of net sales last year. Net income increased to $38.7 million versus $14.0 million. Adjusted EBITDA2 was $122.2 million versus $113.9 million. Without the net benefit from the tariff refund, normalized adjusted EBITDA was $115.4 million. The Company closed 1 net store, ending the quarter with 1,377 stores. Sabrina Simmons, Chief Financial Officer of Petco, added, "We are pleased to deliver another quarter of positive comps and deliver on our bottom-line commitments as we execute on our economic model. Subsequent to the second quarter, we voluntarily prepaid an additional $75 million in debt, bringing our total prepayments to $170 million in the past nine months. Looking ahead, we are pleased to reaffirm our full-year sales and Adjusted EBITDA outlook, reflecting confidence in our second half strategic initiatives while remaining thoughtful about balancing the dynamic backdrop while investing behind our growth priorities."

Q2 2026 Balance Sheet and Cash Flow 

Ending cash balance grew by $104.8 million to $293.5 million versus $188.7 million last year. Inventory decreased 1.1% year-over-year versus the 0.05% increase in net sales. Cash provided by operating activities year-to-date was $130.6 million compared to $70.4 million last year. Free cash flow2 was $60.8 million year-to-date versus $9.9 million last year. Total debt was $1.48 billion, down from $1.59 billion last year. Subsequent to the second quarter, the Company prepaid $75.0 million in debt, underscoring its commitment to lowering its leverage ratio1 to 2x. 2026 Outlook

The Company reaffirmed its full year 2026 net sales and Adjusted EBITDA2 outlook, which includes net IEEPA tariff refunds of $6.8 million, and provided its outlook for the third quarter of 2026. Given the Company's solid profit performance in the first half of the year, the outlook provides the Company the flexibility to continue investing behind its growth initiatives in the second half, while also absorbing ongoing supply chain headwinds.

Assumptions in the outlook include that economic conditions, currency rates and the tax and regulatory landscape remain generally consistent, and that current or planned tariffs on imports into the U.S. from China and other countries as of September 2, 2026, will remain at current levels. Additionally, the outlook assumes no additional IEEPA tariff refunds are received for the balance of the year.

Full Year 2026 Outlook 

FY 2026 Outlook*

Net Sales

Flat to up 1.5% year over year

Adjusted EBITDA2

$415 million to $430 million

Net Interest Expense

~$122 million

Capital Expenditures

~$140 million

Depreciation & Amortization

~$200 million

Net Store Closures

~15-20

Third Quarter 2026 Outlook

Q3 2026 Outlook*

Net Sales

0.4% to 1.0% growth

Adjusted EBITDA2

$100 million to $103 million

(1)

Leverage ratio is defined as net debt divided by Adjusted EBITDA2

(2)

Adjusted EBITDA and Free Cash Flow are non-GAAP financial measures. See "Non-GAAP Financial Measures" for additional information on
non-GAAP financial measures and a reconciliation to the most comparable GAAP measures

* Adjusted EBITDA is a non-GAAP financial measure and has not been reconciled to the most comparable GAAP outlook because it is not possible
to do so without unreasonable efforts due to the uncertainty and potential variability of reconciling items, which are dependent on future events
and often outside of management's control and which could be significant. Because such items cannot be reasonably predicted with the level of
precision required, we are unable to provide outlook for the comparable GAAP measures. Forward-looking estimates of Adjusted EBITDA are made
in a manner consistent with the relevant definitions and assumptions noted herein and in our filings with the Securities and Exchange Commission.

Earnings Conference Call Webcast Information:

Management will host an earnings conference call on September 2, 2026 at approximately 4:15 PM Eastern Time to discuss the Company's financial results. A live webcast of the conference call will be available on the Company's Investor Relations page at https://ir.petco.com/news-and-events/events-and-presentations. A replay of the webcast will be available through the same link approximately two hours after the conference call. 

About Petco:

We're proud to be "where the pets go" to find everything they need to live their best lives for more than 60 years — from their favorite meals and toys, to trusted supplies and expert support from people who get it, because we live it. We believe in the universal truths of pet parenthood — the boundless boops, missing slippers, late night zoomies and everything in between. And we're here for it. Every tail wag, every vet visit, every step of the way. We nurture the pet-human bond in the aisles of more than 1,500 Petco stores across the U.S., Mexico and Chile. Customers experience our exclusive selection of pet care products, services, expertise and membership offerings in stores and online at petco.com, and on the Petco app. In 1999, we founded Petco Love. Together, we support thousands of local animal welfare groups nationwide and have helped find homes for over 7 million animals through in-store adoption events.

Forward-Looking Statements:

This earnings release contains "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995 as contained in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended, concerning expectations, beliefs, plans, objectives, goals, strategies, future events or performance and underlying assumptions and other statements that are not statements of historical fact, including, but not limited to, statements regarding our Q3 and full year 2026 outlook, operational reset of our business, our competitive positioning, profitability, cash generation through our economic model, expense leverage, operating margin expansion, cost action plans and associated cost-savings, our path to sustainable, profitable growth and our expectations regarding tariffs, IEEPA tariff refunds and associated impacts. Such forward-looking statements can generally be identified by the use of forward-looking terms such as "believes," "expects," "may," "intends," "will," "shall," "should," "anticipates," "opportunity," "illustrative," "estimates," "projects", "forecasts" or the negative thereof or other variations thereon or comparable terminology. These statements are only predictions based on our current expectations and projections about future events and reflect our beliefs regarding such future events and do not represent historical facts or statements of current condition. Although Petco believes that the expectations and assumptions reflected in these statements are reasonable, there can be no assurance that these expectations will prove to be correct or that any forward-looking results will occur or be realized. Nothing contained in this earnings release is, or should be relied upon as, a promise or representation or warranty as to any future matter, including any matter in respect of the operations or business or financial condition of Petco. All forward-looking statements are based on current expectations and assumptions about future events that may or may not be correct or necessarily take place and that are by their nature subject to significant uncertainties and contingencies, many of which are outside the control of Petco. Forward-looking statements are subject to a number of risks, uncertainties and other factors that could cause actual results or events to differ materially from the potential results or events discussed in the forward-looking statements, including, without limitation, those identified in this earnings release as well as the following: (i) increased competition (including from multi-channel retailers, mass and grocery retailers, and e-Commerce providers); (ii) reduced consumer demand for our products and/or services; (iii) our reliance on key vendors; (iv) our ability to attract and retain qualified employees; (v) risks arising from statutory, regulatory and/or legal developments; (vi) macroeconomic pressures in the markets in which we operate, including inflation, prevailing interest rates and the impact of tariffs and tariff refunds; (vii) failure to effectively manage our costs; (viii) our reliance on our information technology systems; (ix) our ability to prevent or effectively respond to a data privacy or security breach; (x) our ability to effectively manage or integrate strategic ventures, alliances or acquisitions and realize the anticipated benefits of such transactions; (xi) economic or regulatory developments that might affect our ability to provide attractive promotional financing; (xii) business interruptions and other supply chain issues; (xiii) catastrophic events, political tensions, conflicts and wars (such as the ongoing conflicts in Ukraine and the Middle East), government shutdowns, health crises, and pandemics; (xiv) our ability to maintain positive brand perception and recognition; (xv) product safety and quality concerns; (xvi) changes to labor or employment laws or regulations; (xvii) our ability to effectively manage our real estate portfolio; (xviii) constraints in the capital markets or our vendor credit terms; (xix) changes in our credit ratings; (xx) impairments of the carrying value of our goodwill and other intangible assets; (xxi) our ability to successfully implement our operational adjustments, achieve the expected benefits of our cost action plans and drive improved profitability; (xxii) our ability to deliver sustainable, profitable growth and (xxiii) the other risks, uncertainties and other factors identified under "Risk Factors" in our most recent Annual Report on Form 10-K and elsewhere in Petco's Securities and Exchange Commission filings. The occurrence of any such factors could significantly alter the results set forth in these statements.

Petco cautions that the foregoing list of risks, uncertainties and other factors is not complete, and forward-looking statements speak only as of the date they are made. Petco undertakes no duty to update publicly any such forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by applicable law, regulation or other competent legal authority.

PETCO HEALTH AND WELLNESS COMPANY, INC

CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS

(In thousands, except per share amounts)

(Unaudited and subject to reclassification)

13 Weeks Ended

26 Weeks Ended

August 1,
2026

August 2,
2025

August 1,
2026

August 2,
2025

Net sales:

Products

$    1,216,857

$    1,225,605

$    2,444,944

$    2,467,496

Services and other

272,363

262,924

541,008

514,432

Total net sales

1,489,220

1,488,529

2,985,952

2,981,928

Cost of sales:

Products

733,898

747,143

1,491,676

1,513,428

Services and other

164,175

156,067

328,704

313,213

Total cost of sales

898,073

903,210

1,820,380

1,826,641

Gross profit

591,147

585,319

1,165,572

1,155,287

Selling, general and administrative expenses

543,335

542,297

1,093,134

1,095,906

Operating income

47,812

43,022

72,438

59,381

Interest income

(2,493)

(909)

(3,989)

(2,268)

Interest expense

32,556

33,297

65,340

66,791

Loss on extinguishment and modification of debt

—

—

11,840

—

Income (loss) before income taxes and income from
   equity method investees

17,749

10,634

(753)

(5,142)

Income tax (benefit) expense

(15,710)

746

(13,511)

1,241

Income from equity method investees

(5,201)

(4,084)

(10,756)

(8,694)

Net income attributable to Class A and B-1 common
   stockholders

$         38,660

$         13,972

$         23,514

$           2,311

Net income per Class A and B-1 common share:

Basic

$              0.14

$              0.05

$              0.08

$              0.01

Diluted

$              0.13

$              0.05

$              0.08

$              0.01

Weighted average shares used in computing net income per Class A
   and B-1 common share:

Basic

285,629

279,058

284,657

278,303

Diluted

290,497

285,741

289,691

284,350

PETCO HEALTH AND WELLNESS COMPANY, INC

CONSOLIDATED BALANCE SHEETS

(In thousands, except per share amounts)

(Unaudited and subject to reclassification)

 August 1,
2026

 January 31,
2026

ASSETS

Current assets:

Cash and cash equivalents

$       293,498

$       256,736

Receivables, less allowance for credit losses1

38,386

45,812

Merchandise inventories, net

601,591

590,210

Prepaid expenses

54,433

51,747

Other current assets

65,190

75,281

Total current assets

1,053,098

1,019,786

Fixed assets

2,433,782

2,378,208

Less accumulated depreciation

(1,803,480)

(1,722,060)

Fixed assets, net

630,302

656,148

Operating lease right-of-use assets

1,268,518

1,288,593

Goodwill

980,064

980,064

Trade name

1,025,000

1,025,000

Other long-term assets

209,668

203,834

Total assets

$    5,166,650

$    5,173,425

LIABILITIES AND EQUITY

Current liabilities:

Accounts payable and book overdrafts

$       455,314

$       450,552

Accrued salaries and employee benefits

132,518

154,148

Accrued expenses and other liabilities

225,908

204,751

Current portion of operating lease liabilities

340,643

320,082

Current portion of long-term debt and other lease liabilities

12,061

4,608

Total current liabilities

1,166,444

1,134,141

Senior secured credit facilities, net, excluding current portion

872,798

1,488,527

Senior notes, net

590,567

-

Operating lease liabilities, excluding current portion

1,005,146

1,047,185

Deferred taxes, net

246,861

234,911

Other long-term liabilities

77,907

104,407

Total liabilities

3,959,723

4,009,171

Commitments and contingencies

Stockholders' equity:

Class A common stock2

248

244

Class B-1 common stock3

38

38

Class B-2 common stock4

—

—

Preferred stock5

—

—

Additional paid-in-capital

2,328,170

2,312,354

Accumulated deficit

(1,116,479)

(1,139,993)

Accumulated other comprehensive loss

(5,050)

(8,389)

Total stockholders' equity

1,206,927

1,164,254

Total liabilities and stockholders' equity

$    5,166,650

$    5,173,425

1

Allowances for credit losses are $801 and $779, respectively 

2

Class A common stock, $0.001 par value: Authorized - 1.0 billion shares;
     Issued and outstanding - 248.2 million and 243.7 million shares, respectively

3

Class B-1 common stock, $0.001 par value: Authorized - 75.0 million shares;
     Issued and outstanding - 37.8 million shares

4

Class B-2 common stock, $0.000001 par value: Authorized - 75.0 million shares; 
     Issued and outstanding - 37.8 million shares

5

Preferred stock, $0.001 par value: Authorized - 25.0 million shares;
     Issued and outstanding - none

PETCO HEALTH AND WELLNESS COMPANY, INC

CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited and subject to reclassification)

26 Weeks Ended

August 1,
2026

August 2,
2025

Cash flows from operating activities:

Net income

$         23,514

$            2,311

Adjustments to reconcile net income to net cash provided by
  operating activities:

Depreciation and amortization

99,440

99,171

Amortization of debt discounts and issuance costs

2,689

2,499

Provision for deferred taxes

(1,439)

1,113

Equity-based compensation

18,051

18,209

Loss on extinguishment and modification of debt

11,840

—

Income from equity method investees

(10,756)

(8,694)

Amounts reclassified out of accumulated other comprehensive loss

(24)

(413)

Non-cash operating lease costs

206,243

205,005

Changes in assets and liabilities:

Receivables

7,427

5,783

Merchandise inventories

(11,381)

44,823

Prepaid expenses and other assets

3,696

(9,487)

Accounts payable and book overdrafts

5,084

(69,691)

Accrued salaries and employee benefits

(21,628)

(26,729)

Accrued expenses and other liabilities

20,722

14,508

Operating lease liabilities

(209,279)

(206,414)

Other long-term liabilities

(13,615)

(1,556)

Net cash provided by operating activities

130,584

70,438

Cash flows from investing activities:

Cash paid for fixed assets

(69,788)

(60,516)

Insurance recoveries

422

—

Proceeds from sale of assets

—

2,425

Cash received from partial surrender of officers' life insurance

74

—

Net cash used in investing activities

(69,292)

(58,091)

Cash flows from financing activities:

Borrowings under long-term debt agreements

1,500,000

—

Repayments of long-term debt

(1,502,250)

—

Debt refinancing costs and original issue discount

(28,442)

—

Payments for finance lease liabilities

(3,172)

(3,252)

Proceeds from employee stock purchase plan and stock option exercises

1,923

1,998

Tax withholdings on stock-based awards

(4,261)

(3,026)

Net cash used in financing activities

(36,202)

(4,280)

Net increase in cash, cash equivalents and restricted cash

25,090

8,067

Cash, cash equivalents and restricted cash at beginning of period

269,412

181,665

Cash, cash equivalents and restricted cash at end of period

$       294,502

$       189,732

NON-GAAP FINANCIAL MEASURES

The following information provides definitions and reconciliations of the non-GAAP financial measures presented in this earnings release to the most directly comparable financial measures calculated and presented in accordance with generally accepted accounting principles (GAAP). The Company has provided this non-GAAP financial information, which is not calculated or presented in accordance with GAAP, as information supplemental and in addition to the financial measures presented in this earnings release that are calculated and presented in accordance with GAAP. Such non-GAAP financial measures should not be considered superior to, as a substitute for or alternative to, and should be considered in conjunction with, the GAAP financial measures presented in this earnings release. The non-GAAP financial measures in this earnings release may differ from similarly titled measures used by other companies.

Adjusted EBITDA

Adjusted EBITDA is considered a non-GAAP financial measure under the Securities and Exchange Commission's (SEC) rules because it excludes certain amounts included in net income calculated in accordance with GAAP. Management believes that Adjusted EBITDA is a meaningful measure to share with investors because it facilitates comparison of the current period performance with that of the comparable prior period. In addition, Adjusted EBITDA affords investors a view of what management considers to be Petco's core operating performance as well as the ability to make a more informed assessment of such operating performance as compared with that of the prior period. Please see the Company's Annual Report on Form 10-K for the fiscal year ended January 31, 2026 filed with the SEC on March 13, 2026 for additional information on Adjusted EBITDA.

The table below reflects the calculation of Adjusted EBITDA for the thirteen and twenty-six weeks ended August 1, 2026 compared to the thirteen and twenty-six weeks ended August 2, 2025.

(dollars in thousands)

13 Weeks Ended

26 Weeks Ended

Reconciliation of Net Income Attributable to Class A and B-1
   Common Stockholders to Adjusted EBITDA

August 1,
2026

August 2,
2025

August 1,
2026

August 2,
2025

Net income attributable to Class A and B-1 common stockholders

$         38,660

$         13,972

$         23,514

$           2,311

Add (deduct):

Interest expense, net

30,063

32,388

61,351

64,523

Income tax (benefit) expense

(15,710)

746

(13,511)

1,241

Depreciation and amortization

50,399

49,360

99,440

99,171

Income from equity method investees

(5,201)

(4,084)

(10,756)

(8,694)

Loss on extinguishment and modification of debt

—

—

11,840

—

Equity-based compensation

8,600

8,789

18,051

18,209

Mexico joint venture EBITDA (1)

13,139

10,360

26,055

20,558

Other costs (2)

2,269

2,329

3,566

5,990

Adjusted EBITDA

$       122,219

$       113,860

$       219,550

$       203,309

Net sales

$    1,489,220

$    1,488,529

$    2,985,952

$    2,981,928

Net margin (3)

2.6 %

0.9 %

0.8 %

0.1 %

Adjusted EBITDA Margin

8.2 %

7.6 %

7.4 %

6.8 %

(1)

Mexico joint venture EBITDA represents 50 percent of the entity's operating results for all periods, as adjusted to reflect the results
on a basis comparable to Adjusted EBITDA. In the financial statements, this joint venture is accounted for as an equity method
investment and reported net of depreciation and income taxes because such a presentation would not reflect the adjustments made
in the calculation of Adjusted EBITDA, we include the 50 percent interest in the Company's Mexico joint venture on an Adjusted
EBITDA basis to ensure consistency. The table below presents a reconciliation of Mexico joint venture net income to Mexico joint
venture EBITDA.

13 Weeks Ended

26 Weeks Ended

(in thousands)

August 1,
2026

August 2,
2025

August 1,
2026

August 2,
2025

Net income

$         10,402

$            8,167

$         21,506

$         17,387

Depreciation

8,838

6,793

17,144

13,390

Income tax expense

5,216

3,935

10,410

8,101

Foreign currency loss

326

696

470

404

Interest expense, net

1,496

1,129

2,579

1,833

EBITDA

$         26,278

$         20,720

$         52,109

$         41,115

50% of EBITDA

$         13,139

$         10,360

$         26,055

$         20,558

(2)

Other costs include, as incurred: restructuring costs and restructuring-related severance costs; legal reserves associated with
significant, non-ordinary course legal or regulatory matters; and costs related to certain significant strategic transactions.

(3)

We define net margin as net loss attributable to Class A and B-1 common stockholders divided by net sales and Adjusted EBITDA
margin as Adjusted EBITDA divided by net sales.

Free Cash Flow

Free Cash Flow is a non-GAAP financial measure that is calculated as net cash provided by operating activities less cash paid for fixed assets. Management believes that Free Cash Flow, which measures the ability to generate additional cash from business operations, is an important financial measure for use in evaluating the Company's financial performance.

The table below reflects the calculation of Free Cash Flow for the thirteen and twenty-six weeks ended August 1, 2026 compared to the thirteen and twenty-six weeks ended August 2, 2025.

(in thousands)

13 Weeks Ended

26 Weeks Ended

August 1,
2026

August 2,
2025

August 1,
2026

August 2,
2025

Net cash provided by operating activities

$      161,553

$        85,892

$      130,584

$        70,438

Cash paid for fixed assets

(31,635)

(32,104)

(69,788)

(60,516)

Free Cash Flow

$     129,918

$        53,788

$        60,796

$          9,922

Net Debt 

The table below reflects the calculation for net debt as of August 1, 2026 compared to January 31, 2026 and August 2, 2025.

(dollars in thousands)

August 1,
2026

January 31,
2026

August 2,
2025

Total debt:

Senior secured credit facilities, net, including current portion

$            881,798

$         1,488,527

$         1,580,688

Senior notes, net

590,567

—

—

Finance leases, including current portion

7,542

9,683

12,012

Total debt

1,479,907

1,498,210

1,592,700

Less: cash and cash equivalents

(293,498)

(256,736)

(188,748)

Net Debt

$         1,186,409

$         1,241,474

$         1,403,952

SOURCE Petco - Investor Relations