Key Highlights

  • SMWB reported second-quarter 2026 Revenue of $77.2 million, up 9 percent year over year and beating the $75.6 million estimate by 2.14 percent, above the top of guidance.
  • The company achieved positive GAAP operating profit for the first time in its history, with adjusted EPS of $0.06 beating the $0.03 estimate by 100 percent.
  • Three large multi-year enterprise contracts signed during the quarter totaled more than $60 million in cumulative contract value, with a fourth signed in July.
  • Management raised full-year 2026 revenue guidance to $340 million to $380 million and non-GAAP operating profit guidance to $24 million to $26 million.

Enterprise Data Contracts Signal a Shift Beyond Software Sales

Similarweb Ltd. (NYSE:SMWB), a Givatayim, Israel-based digital intelligence and market analytics company, said three large enterprise contracts signed during the quarter reflect a shift in how the largest global companies view its digital data, increasingly treating it as strategic infrastructure rather than a software subscription. One of the contracts, with a leading technology company for large language model training, made that customer the company's third relationship generating more than $10 million in annual recurring revenue. Management said the other two large contracts involve enterprises using the company's data across multiple AI-driven applications rather than Training alone, a distinction it believes represents a substantially larger opportunity than data licensing for training purposes.

Because these enterprise data relationships require significant coordination across sales, R&D, data science, and legal functions, the pace at which the current pipeline of similar opportunities converts into signed contracts will depend on the company's ability to scale this cross-functional deal execution beyond its historical land-and-expand software motion.

Retention Metrics Improve Alongside AI-Driven Revenue Growth

Net revenue retention increased to 100 percent across all customers and 107 percent for customers generating more than $100,000 in annual recurring revenue, improvements management attributed to earlier-year changes that shifted account management focus toward expansion rather than new customer acquisition. AI-related revenue reached 13 percent of total revenue, up from 11 percent at the end of 2025, and the company said it expects this share to continue expanding as more enterprises integrate its data into AI agents and generative AI research workflows.

The portion of revenue tied to multi-year commitments grew to 66 percent from 57 percent a year earlier, and revenue from customers generating more than $100,000 in annual Recurring Revenue reached nearly 70 percent of the business, up from 63 percent, underscoring the company's continued transition toward a smaller number of larger, more durable enterprise relationships.

Distribution Expands Through AI Platform Partnerships

The company expanded its data distribution through integrations with AI platforms including Perplexity and Manus during the quarter, alongside existing availability through the Model Context Protocol on Claude and ChatGPT. Management views these partnerships as new distribution channels that extend the company's reach to users beyond its traditional go-to-market motion, though the direct revenue contribution from these AI ecosystem partnerships remains at an early stage relative to the company's core enterprise sales.

Conclusion

Similarweb's first GAAP operating profit, combined with a record quarter for enterprise contract signings, supports management's view that the company is transitioning from a software subscription Business into an enterprise data infrastructure provider for the AI era. The durability of this transition will depend on converting the current large pipeline of enterprise opportunities into signed contracts at a similar pace, and on continuing to expand AI-related revenue as a share of the overall business.