SentinelOne shares tumble after layoffs and weak forecast overshadow earnings
Cybersecurity company to cut 8% of workforce as it shifts focus toward AI and data operations.
SentinelOne shares plunged in after-hours trading on Wall Street after the company published its first-quarter financial results and announced layoffs affecting 8% of its workforce. The cybersecurity company reported results that largely met expectations but issued a relatively weak forecast, sending the stock sharply lower in late trading.
CEO Tomer Weingarten said the layoffs are intended to improve efficiency and sharpen the company’s focus on its more profitable AI and data operations. The cuts, affecting about 230 employees, including some in Israel, will result in a one-time expense of approximately $25 million. About half of that amount is related to severance payments, while the remainder is tied to share-based compensation.
SentinelOne develops endpoint cybersecurity solutions and acquired Israeli startup Prompt Security about a year ago in an effort to accelerate its expansion into AI-based cybersecurity products.
The company’s revenue grew 21% in the fiscal first quarter to $277 million. Although its loss narrowed, SentinelOne still reported an operating loss of $79 million and a net loss of $76 million. Excluding one-time items, the company posted an operating profit of $10 million.
For the next quarter, SentinelOne expects revenue of $289 million to $291 million and adjusted operating profit of $23 million to $25 million before one-time and accounting-related expenses.
