Gitlab Stock Price Drops Despite Q3 Beat, Decelerating Growth Alarms Analysts

Shares of Gitlab Inc (NASDAQ:GTLB) tanked in early trading on Wednesday, after the company reported third-quarter results.

Here are some key analyst takeaways:

• Rosenblatt Securities analyst Blair Abernethy reiterated a Buy rating, while reducing the price target from $58 to $55.
• Canaccord Genuity analyst Kingsley Crane reiterated a Buy rating and price target of $70.

Check out other analyst stock ratings.

Rosenblatt Securities: Gitlab's revenues grew 25% year-on-year to $244.4 million, driven by subscription revenue growth of 27%, Abernethy said. "In Q3, Gitlab saw headwinds in federal government and continued SMB weakness," he wrote.

For the fiscal Q4, GitLab guided to revenue of $251-$252 million, roughly in-line with consensus of $251.9 million. GitLab raised its revenue guide for fiscal 2026 to $946-$947 million and non-GAAP earnings outlook to 95-96 cents per share.

Canaccord Genuity: Gitlab's NRR (net recurring revenue) growth decelerated to 119%, from 121% in the previous quarter and 124% in the year-ago quarter, Crane said. Gross margin remained strong, coming in at 88.6%, although this represents a year-on-year contraction of around 240 basis points, he added.

GitLab reached a total of 10,475 customers with more than $5,000 and 1,405 customers of more than 100,000, the analyst stated. "With the mixed quarter, management was still able to raise the full-year guide across the board," he further wrote.

GTLB Price Action: Shares of Gitlab had declined by 13.6% to $37.44 at the time of publication on Wednesday.

Read More:

• Gitlab Analysts Praise Strong Revenue But Caution On Guidance

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