SentinelOne Prepares for Fourth Quarter Earnings Report

SentinelOne S is set to report its fourth-quarter fiscal 2025 results on March 12.

Check the latest EPS estimates and surprises in the Zacks earnings Calendar.

Revenue and Earnings Expectations

The anticipated revenue for the fiscal fourth quarter stands at $222 million. The Zacks Consensus Estimate aligns closely at $222.03 million, indicating a robust growth of 27.47% compared to the revenue reported in the same quarter last year.

For earnings, the consensus estimate remains steady at 1 cent per share over the past month. In contrast, the company reported a loss of 2 cents during the same quarter last year.

SentinelOne has exceeded the Zacks Consensus Estimate in three of the last four quarters, with one miss, resulting in an average earnings surprise of 62.50%.

SentinelOne, Inc. Price and EPS Surprise

SentinelOne, Inc. price-eps-surprise | SentinelOne, Inc. Quote

Let us examine the developments surrounding S shares ahead of this announcement.

Key Factors Impacting SentinelOne’s Performance

SentinelOne has faced tough macroeconomic conditions and intense competition within the cybersecurity industry. However, it is likely that the fiscal fourth-quarter performance may have benefited from the significant adoption of its Singularity platform.

This platform is enhanced by Purple AI, S’s cutting-edge Generative AI security analyst, which hastens threat detection and investigations, decreases Mean Time to Response, and provides comprehensive enterprise security. Purple AI has emerged as the fastest-growing solution within SentinelOne’s offerings, thus contributing to an increase in the adoption of its services.

Furthermore, the strong momentum with large enterprise customers is expected to persist into the fourth quarter of fiscal 2025. Customers generating over $100,000 in Annual Recurring Revenue (ARR) grew by 24% year-over-year to 1,310 in the fiscal third quarter. Additionally, ARR per customer showcased double-digit growth year-over-year, driven by robust platform adoption and success with larger clients.

The Zacks Consensus Estimate for fourth-quarter fiscal 2025 ARR is set at $921 million, indicating a year-over-year growth of 27.2%. Additionally, the consensus estimate for customers with over $100,000 in ARR is pegged at 1,370, reflecting a 21% increase from the previous year.

S Shares Underperform in the Last Year

Image Source: Zacks Investment Research

Over the past 12 months, SentinelOne shares have dropped by 27.9%, underperforming the broader Zacks Computer and Technology sector, which returned 11.1%, and the Zacks Security industry, which saw an appreciation of 18.7%.

SentinelOne’s Stock Valuation Insights

Currently, the stock does not present as an attractive buying opportunity, indicated by its Value Score of F, suggesting a stretched valuation at this point in time.

Looking at the forward 12-month price/sales ratio, SentinelOne shares are trading at 6.1X, slightly above the sector’s average of 6.06X.

P/S Ratio (F12M)

Image Source: Zacks Investment Research

Strong Product Portfolio and Partnerships Bolster Prospects

SentinelOne’s long-term growth potential is bolstered by its innovative product lineup. The Singularity platform integrates data capabilities and AI-driven security across endpoints, cloud identity, and third-party applications—all accessible through a single user interface.

Key solutions, including Singularity Endpoint, Singularity Cloud Security, Singularity Data, and Purple AI, position SentinelOne to capture a market worth over $100 billion. The total Addressable Market for Endpoint Security, Data Analytics, Cloud Security, and Generative AI Security is estimated at $17 billion, $31 billion, $12 billion, and $3 billion, respectively, indicating substantial growth opportunities.

SentinelOne’s extensive partner network, which includes industry giants such as Alphabet GOOGL, Lenovo, Amazon AMZN, and ServiceNow NOW, is aiding its customer acquisition efforts. The Singularity Cloud Workload Security for Serverless Containers offers real-time, AI-enhanced protection for container workloads operating on Amazon Web Services (“AWS”) Fargate for Amazon ECS and Amazon EKS.

Additionally, the company has expanded its integration with AWS, making Purple AI accessible through Amazon Bedrock, thereby enhancing its capacity to support organizations in securing Generative AI applications.

In the third quarter of fiscal 2025, SentinelOne forged a partnership with Lenovo to pre-install the Singularity platform and Purple AI on enterprise PC shipments, significantly enhancing its market presence. The SentinelOne App efficiently synchronizes threat data into ServiceNow Incident Response for streamlined security operations.

Investment Outlook: Buy or Sell SentinelOne Stock?

While SentinelOne showcases a robust product portfolio and strong partnerships, the prevailing macroeconomic challenges and a high valuation raise caution for potential investors.

Currently, S shares are trading below both the 50-day and 200-day moving averages, reflecting a bearish trend.

S Shares Trade Below 50-Day & 200-Day SMA

Image Source: Zacks Investment Research

Currently, SentinelOne holds a Zacks Rank #3 (Hold), suggesting it may be prudent to wait for a better opportunity to accumulate the stock.

For those interested, you can view the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.