ServiceTitan Inc. reported fiscal fourth‑quarter and full‑year 2026 results that exceeded expectations, with adjusted earnings per share of $0.27 versus the consensus estimate of $0.18 and revenue of $253.99 million against a forecast of $245.38 million. Platform revenue grew 23% year‑over‑year to $245.1 million, and gross transaction volume climbed to $19.8 billion from $17.0 billion a year earlier. Active customers rose to roughly 10,800, a 14% increase from the prior year.
The earnings beat was driven by disciplined cost management and a favorable mix shift toward higher‑margin platform revenue. Adjusted EPS more than doubled from $0.12 in the prior year’s fourth quarter, reflecting both revenue growth and a 330‑basis‑point lift in platform gross margin to 80%. The company’s operating income of $27.1 million translated into a 10.7% operating margin, up 740 basis points from the previous year, as the firm continued to scale its AI‑powered “Max” platform while keeping support‑service costs in check.
Revenue outperformed expectations thanks to robust demand across the trades sector. Platform revenue’s 23% rise was supported by increased adoption of subscription‑based services, while the 16% jump in gross transaction volume indicates deeper penetration of the company’s marketplace. The 14% rise in active customers underscores the platform’s expanding footprint and the company’s ability to convert new users into recurring revenue streams.
Margin expansion was a key theme. Platform gross margin reached 80%, up 330 basis points, largely due to reallocating customer‑success expenses to sales and marketing. Total gross margin improved to 73.8%, a 360‑basis‑point gain, and free cash flow tripled to $85.1 million for the year, with Q4 free cash flow at $35 million versus $11 million a year earlier. These figures illustrate the company’s growing operational leverage and cash‑generating capacity.
Looking ahead, ServiceTitan guided for fiscal 2027 revenue of $1.11 billion to $1.12 billion and non‑GAAP operating income of $128 million to $133 million. First‑quarter 2027 revenue was projected at $255 million to $257 million, a modest sequential increase that signals management’s cautious outlook amid potential macro headwinds. The guidance reflects confidence in continued platform adoption while acknowledging the need for disciplined growth.
Management highlighted the company’s strategic focus on AI and operational automation. CEO Ara Mahdessian said, “Our vision and mission from the beginning have been simple: to inflect our customers' revenue and margins by automating their operations.” He also noted, “We celebrated the 1‑year anniversary of our IPO and surpassed a $1 billion of annualized revenue run rate.” President Vahe Kuzoyan added, “Our goal and growth strategy is to become the operating system for the trades. Our core residential trades are performing well while our investments in roofing and commercial continue to deliver.”
The company’s AI platform, “Max,” is positioned as a growth catalyst, with early adopters reporting a 50% increase in average ticket size. This technological advancement, combined with a strong net dollar retention above 110%, underpins ServiceTitan’s trajectory toward higher margins and scalable revenue growth.
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