Asana (ASAN 2.46%), the work management software company known for its cloud-based platform that helps teams organize and track projects, reported its second quarter fiscal 2026 results on Sept. 3, 2025. The most important news was that revenue (GAAP) totaled $196.9 million, up 9.9% from the same period last year, beating analyst estimates. Adjusted earnings per share were $0.06, a swing from a $(0.05) loss in the same period last year, while adjusted operating margin improved notably to 7.1%.
The company also raised its full-year guidance, signaling greater confidence in Asana’s ability to drive long-term, durable growth and sustained profitability. The quarter showed strong cost discipline, higher profitability, and ongoing innovation.
| Metric | Q2 FY26 | Q2 FY25 | Y/Y Change |
|---|---|---|---|
| Adjusted EPS | $0.06 | ($0.05) | n/a |
| Revenue | $196.9 million | $179.2 million | 9.9% |
| Adj. operating margin | 7.1% | (8.7%) | 15.8 pp |
| Adj. free cash flow | $35.4 million | $12.8 million | 176.6% |
Source: Asana. Note: Fiscal 2026's second quarter ended July 31, 2025. Fiscal 2025's Q2 ended July 31, 2024.
Business Overview and Recent Focus
Asana delivers a cloud-based work management platform that enables organizations to plan, track, and manage tasks and projects across teams. The platform helps streamline workflows, break down complex initiatives, and improve team collaboration in businesses of all sizes. Its core functionality unites task management with progress tracking, goal setting, and automation -- all delivered through a user-friendly interface.
Recently, Asana has prioritized expanding its AI-driven feature set, deepening security certifications, and scaling its platform for large enterprises. The company has focused on integrating artificial intelligence to automate tasks, provide predictive insights, and improve workflow adaptability, aiming to attract larger customer cohorts and address complex business needs. Key success factors include driving customer retention, accelerating adoption of AI-powered offerings, and maintaining security and compliance as more highly regulated industries become customers.
Key Achievements and Developments in the Quarter
Revenue grew 9.9% over the prior year period, slightly outpacing the high end of the company’s own guidance. Asana also achieved its highest-ever non-GAAP operating margin of 7.1%, marking a sharp improvement from a negative 8.7 % a year earlier. The company posted non-GAAP net income of $15.1 million, or $0.06 per diluted share, turning around from an $11.1 million non-GAAP net loss in the prior year and $(0.05) per share in the prior year. Adjusted free cash flow reached $35.4 million, compared to $12.8 million in the prior year period.
Expenses as a percentage of sales fell across core functions: research and development dropped to 24.2% of revenue from 31.5% last year (non-GAAP), and sales and marketing dropped to 44.8% from 50.9% (non-GAAP). This tighter cost control helped produce both margin expansion and a $27.3 million reduction in operating loss on a GAAP basis.
Product innovation remained central. During the quarter, Asana launched the Smart Workflow Gallery, a suite of prebuilt, AI-powered workflows aimed at making it easier for customers to embed artificial intelligence in their daily work routines. Further, management referenced upcoming releases such as “Teammates” and expanded partnerships, including Asana’s presence in the Amazon Web Services Marketplace. AI Studio, Asana’s tool for embedding workflow automation and insights, continued to gain traction, especially among larger enterprise clients.
On the customer side, large enterprise customer momentum persisted. The number of customers spending $100,000 or more annually rose 19% year over year to 770, with 42 net additions since the prior quarter. Core customers, defined as those spending $5,000 or more annually, grew 9% year over year to 25,006, and revenue from this group rose 12% compared to the prior year period. Despite these gains, management noted that net retention rates -- a measure of customer renewal and expansion -- have plateaued at 96%.
Security and compliance advanced as differentiators. Asana achieved “FedRAMP In Process” designation, signaling its intent to serve more public sector and regulated industry clients. Ongoing certifications such as ISO compliance and annual SOC 2 Type II reporting were cited as ways the company maintains trust with larger organizations. Management also called out the integration of Asana’s platform in environments demanding strict security requirements as a foundation for future enterprise expansion.
Looking Ahead: Guidance and Strategic Considerations
Management forecast revenue of $197.5 million to $199.5 million, implying year-over-year growth of 7.4% to 8.5%. Full-year revenue guidance increased slightly to a range of $780.0 million to $790.0 million. The full-year non-GAAP operating margin target was raised to 6%. However, top-line growth is slowing: management anticipates revenue growth slipping to high single digits (7% to 9%). Non-GAAP operating income is expected in the $12 million to $14 million range, with non-GAAP earnings per share of $0.06 to $0.07.
Company leadership highlighted that sustaining margin gains now relies on both continued cost discipline and improvements in net retention and expansion, as discussed in the context of non-GAAP results. The company’s net retention rate was 96%. Product innovation, especially in AI, will be crucial in driving increased usage and contract sizes with large enterprise customers. Investors should monitor adoption of AI Studio features, international expansion, customer cohort growth, and any material customer contract renewals or downgrades, as in the $100 million-plus renewal that occurred last quarter.
Revenue and net income presented using U.S. generally accepted accounting principles (GAAP) unless otherwise noted.
