ServiceTitan reported Q2 2026 revenue of $292.8 million, up 21% year-over-year, beating consensus estimates by $6.9 million. Subscription revenue reached $212.4 million, up 22% year-over-year, while usage revenue was $72.1 million, up 24%. Total platform revenue was $284.5 million, up 22%, and professional services and other revenue totaled $8.3 million. The company reported an adjusted loss of $0.26 per share, missing analysts' consensus forecast by $0.01. Gross transaction volume (GTV) was $26.8 billion, up 17%, but noted as about 200 basis points below recent quarters due to slower lead volume trends.
Operating income was $44.4 million, with an operating margin of 15.2%, up 310 basis points year-over-year. Platform gross margin was 81.1%, up 40 basis points, and total gross margin was 74.6%, up 20 basis points. Free cash flow was $50.5 million, up 47% year-over-year. Net dollar retention remained above 110%, and the company's current ratio was 4.44 with minimal debt, holding more cash than debt. Market capitalization was $8.39 billion.
The stock price closed at $81.58, down 7.21% from the previous close of $87.92. After-hours trading saw an additional 19.96% decline, dropping to $65.30. The 52-week range is between $54.17 and $119.99.
ServiceTitan provided guidance for Q3, expecting revenue between $285 million and $287 million, and operating income between $29 million and $30 million. For the full fiscal year, revenue guidance is between $1.139 billion and $1.144 billion, with operating income between $152 million and $154 million. The company expects mid-teens revenue growth for the back half of the year and 25% incremental margins as an annual floor. The target for Max enrolled locations is over 700 by the end of fiscal 2027, up from just over 200 at the end of Q2.
Headwinds include a $2 million to $3 million subscription revenue headwind from Max-related revenue recognition timing and about $2 million in lower professional services revenue due to a shift away from new trade expansion. Management cited softer lead volume growth in May and June, particularly among HVAC-focused customers, before market conditions stabilized in July. ServiceTitan narrowed its trade-expansion plans to focus on existing commercial trades and residential roofing, while prioritizing investments in Max and the Software Factory.
Ara Mahdessian, Co-founder and CEO, stated, "Our strong momentum delivering the Agentic Operating System for the trades resulted in 21% year-over-year revenue growth and record free cash flow this quarter." Dave Sherry, CFO, added, "The fact that we could deliver such strong margins in a quarter with modest GTV growth gives us increased conviction in the higher operating leverage of the business moving forward."
Delponte Plumbing & Heating, a customer of ServiceTitan, reported year-over-year revenue growth of over 35% in Q1 2026 and over 45% in Q2 2026 after utilizing Max. The company served 400 customers in a new recurring-service vertical in 3 months without adding back-office staff, improving the technician-to-admin ratio from 2:1 in 2025 to 3:1 in 2026, with technicians averaging 45 hours per week during peak season.
