Kinaxis (TSE:KXS) reported fiscal second-quarter 2026 revenue growth led by its software-as-a-service business, higher expansion activity among existing customers and increased demand for supply-chain planning and orchestration tools. The company raised its full-year revenue and SaaS revenue outlook while reaffirming its adjusted EBITDA margin guidance.
Total revenue rose 16% year over year to $158.8 million, while SaaS revenue increased about 20% to $106.5 million. SaaS represented 67% of total revenue, compared with 65% in the prior-year quarter. Foreign exchange rates reduced total revenue by approximately $900,000 and SaaS revenue by approximately $600,000, according to the company.
Bookings, ARR and Customer Expansion
Annual recurring revenue increased 19% to $465.6 million, or 21% on a constant-currency basis. SaaS remaining performance obligations rose 19% to $940.3 million, while total RPO increased 18% to $983.4 million.
Gaurav said the company’s average deal size was nearly double that of the second quarter of 2025. Contracts with more than $1 million in average annual contract value were won at three times the rate recorded a year earlier, he said.
Kinaxis also reported a record quarter for expansion bookings from existing customers, with annual contract value bookings from expansions rising more than 70% year over year. The expansions included adoption of agentic AI, machine-learning demand forecasting, inventory optimization, enterprise scheduling and other Maestro platform capabilities.
The company said all new proposals now include Maestro Activity Units, its usage-based pricing structure. Beginning in July, certain customer renewals also began incorporating MAU pricing bundles.
New customer additions and deployments cited during the call included Lacoste, Gedeon Richter, Dechra, Tsumura, Rockwell Automation and Ansaldo Energia. Gaurav also said Ecolab is expanding its Kinaxis footprint with Nalco Water in Europe.
AI, Data Partnerships and Forward-Deployed Engineers
Kinaxis said approximately 10% of its installed customer base has a paid or trial subscription for Maestro Agents. The company’s agent offerings include packaged tools within the Maestro platform and Maestro Agent Studio, which enables customers to compose agents for specific use cases.
Gaurav said that some of the company’s largest second-quarter wins included bundles of agents, and that nearly every major new customer agreement includes some agent capabilities. He described Kinaxis’ differentiation as its access to planning data within Maestro, its decisioning algorithms and its supply-chain network model.
The company also said its Databricks Data Fabric partnership is live in Maestro. The offering is designed to ingest external signals such as social sentiment, weather and news feeds alongside structured enterprise data.
Kinaxis is building a forward-deployed engineering, or FDE, organization to work directly with customers on AI-driven supply-chain transformation. Gaurav said FDE pods are being developed in North America, Europe and India, and that the company plans to supplement internal capabilities with selected partners that have supply-chain, data engineering and data science expertise.
Chief Financial Officer and Chief Strategy Officer Herb Yeh said no contribution from the FDE initiative is included in 2026 guidance. The company expects FDE-related revenue to be recognized mostly ratably and is targeting SaaS-like gross margins for bundled offerings.
Profitability, Cash Flow and Share Repurchases
Gross profit rose 19% to $104.4 million, and gross margin improved by 1.6 percentage points to 66%. Subscription software margin declined to 78% from 80%, partly due to higher hosting costs during the company’s migration from private data centers to cloud infrastructure.
Kinaxis expects to exit its private European data center by the end of 2026. North American data center migrations are underway and are expected to be completed by the end of 2027.
Professional services revenue increased approximately 12% to $42.1 million, while professional services gross margin improved to 32% from 23%, supported by higher realized rates. The company expects professional services revenue to be lower in the second half than in the first half as it shifts more implementation and support work to systems integrator partners.
Adjusted EBITDA increased 23% to $41.4 million, producing a 26% margin. Net profit rose 15% to $21.2 million, and diluted earnings per share increased 19% to $0.76.
Cash flow from operating activities increased 36% to $30.7 million. Kinaxis ended the quarter with $310.7 million in cash equivalents and short-term investments. During the quarter, it repurchased more than 450,000 shares for approximately $47 million. Since the repurchase program began in November, the company has bought back 1.2 million shares for approximately $134 million, reducing its outstanding share count on a net basis by 2.9%.
Raised 2026 Revenue Outlook
For the full year ending Dec. 31, 2026, Kinaxis raised its total revenue outlook to a range of $625 million to $640 million, representing year-over-year growth of approximately 14% to 17%.
- SaaS revenue is now expected to be $427 million to $434 million, representing growth of 18% to 20%.
- Subscription term license revenue is expected to rise 85% year over year, with most remaining revenue anticipated in the fourth quarter.
- Professional services revenue is expected to grow at a mid-single-digit rate for the year.
- Adjusted EBITDA margin guidance was reaffirmed at 25% to 26%.
The company expects foreign exchange to remain a headwind, estimating a full-year impact of $4 million to $4.5 million on total revenue and $2.5 million to $3 million on SaaS revenue.
Yeh said Kinaxis plans to continue investing in product innovation and go-to-market initiatives while maintaining disciplined capital allocation. He said any acquisitions would need to align closely with the company’s product, technology and go-to-market roadmaps and provide identifiable revenue synergies.
About Kinaxis (TSE:KXS)
Kinaxis is a leader in modern supply chain orchestration, powering complex global supply chains, and supporting the people who manage them. Our powerful, AI-infused supply chain orchestration platform, Maestro, combines proprietary technologies and techniques that provide full transparency and agility across the entire supply chain – from multi-year strategic planning to last-mile delivery. We are trusted by renowned global brands to provide the agility and predictability needed to navigate today’s volatility and disruption.
