Sprinklr (CXM) Stock Forecast & Price Target

Sprinklr Inc. demonstrated strong financial performance, with calculated billings of $298.6 million reflecting a 10% year-over-year increase, surpassing expectations and indicating robust demand for its services. The company reported professional services revenue of $20.5 million, up 19% year-over-year, which also exceeded consensus estimates, highlighting effective execution in its service offerings. Furthermore, Sprinklr's guidance for FY26 includes projected revenue growth of approximately 3% year-over-year, with non-GAAP EPS expectations significantly above consensus, reinforcing a positive outlook for continued growth and profitability.

Sprinklr Inc. is facing a challenging financial landscape, with expected gross margins declining from 73.3% to 70% due to increasing data and hosting costs, signaling a deterioration in profitability metrics. The company is also contending with macroeconomic uncertainties that could adversely affect sales cycles, close rates, and customer retention, alongside intensifying competition from both large tech companies and specialized service providers in the customer experience management market. Additionally, despite reporting higher-than-expected operating and free cash flow, contracted revenue bookings are projected to decline, further complicating the company's growth outlook.