CXM · Sprinklr
Conviction · Low · more likely to lag the S&P 500 over the next three months
Wrong if: a daily close above $8.21
Note written ·
Price against the kill line
17.2% clear of its kill line on the 13 November 2026 close.
How to read this
This note expects the shares to lag the market, so its kill line sits above the price: a close above the red mark would prove the view wrong. Prices run from low on the left to high on the right. The dot is where the stock closed on 13 November 2026, left of the mark while it is below the line; a dot right of the mark has closed through it.
The scale is stretched near the line, so close calls are easy to see. More than 8% from the line, the stock reads well clear, with a hollow dot to show the figure is off the drawn scale.
The kill line is the research note's own test. The portfolio sells on business facts, not on a price. How the portfolio decides
Three months against the kill line
Daily closes, to . Red: the kill line, a daily close above $8.21, on record since 11 November 2026. The shares are up 1.5% since the close; the S&P 500 is down 2.1% over the same sessions. Figures in the note can cover a different window.
Kill line
A daily close above $8.21, the 31 August 2026 close made on the day of the 52-week intraday high, which would show the shares leading the S&P 500; third-quarter subscription revenue above $197 million with a raised fiscal 2027 outlook would also prove the call wrong.
Research onlyNot in the portfolio.
Catalyst
Key figures from the filings · Technology
Quarter to 31 July 2026, filed 3 September 2026; valuation at the 13 November 2026 close
- Revenue, latest quarter ($M)
- 214
- Revenue, change on a year (%)
- +0.8
- Gross margin (%)
- 65.1
- Operating margin (%)
- 4.7
- Free cash flow, four quarters ($M)
- 128
- Net cash, cash less debt ($M)
- 231
- Price to earnings (×)
- 69.8
- Enterprise value to sales (×)
- 1.6
All filed numbers
What Sprinklr reports to the SEC in its quarterly and annual filings. Each group states its period and filing date once; a figure dated otherwise says so. Built from the filings known on .
| Quarter to | Revenue ($M) | On a year (%) | Gross margin (%) | Operating margin (%) |
|---|---|---|---|---|
| first filed | 214 | +0.8 | 65.1 | 4.7 |
| first filed | 220 | +6.8 | 65.2 | 4.8 |
| first filed | 221 | +8.9 | 65.7 | 6.4 |
| first filed | 219 | +9.2 | 66.4 | 5.3 |
| first filed | 212 | +7.5 | 68.2 | 7.7 |
| first filed | 206 | +4.9 | 69.5 | −0.9 |
| Pre-tax income ($M) | 12.7 |
| Net income ($M) four quarters: 23.2 | 7.1 |
| Diluted shares, change on a year (%) against the quarter to 31 July 2025 | −9.6 |
| Operating cash flow ($M) | 129 |
| Capital spending ($M) | 1.4 |
| Free cash flow ($M) | 128 |
| Cash and short-term investments ($M) | 231 |
| Debt ($M) | None reported |
| Net cash, cash less debt ($M) no debt reported | 231 |
| Deferred revenue ($M) −0.3% on a year | 396 |
| Backlog, orders not yet delivered ($M) +11.1% on a year | 1,027 |
| Receivables ($M) | Not reported |
| Inventory ($M) | Not reported |
| Shareholders' equity ($M) | 520 |
| Market value ($M) | 1,617 |
| Enterprise value, market value plus net debt ($M) no debt reported | 1,386 |
| Enterprise value to sales (×) no debt reported | 1.6 |
| Enterprise value to operating income (×) no debt reported | 29.9 |
| Price to earnings (×) | 69.8 |
| Price to book value (×) | 3.1 |
| Free-cash-flow yield (%) | 7.9 |
Short interest (FINRA, settled 15 October 2026, published 26 October 2026): 4.8% of shares outstanding sold short, 4.7 days of average trading to cover, +3.9% since the previous report.
| Window | Bought | Sold |
|---|---|---|
| 90 daysfrom | $851K | $2.8M |
| 12 monthsfrom | $851K | $11.0M |
The thesis
Sprinklr's shares look more likely to lag the S&P 500 than to lead it over the next three months. The October rally on AI-agent news priced in a recovery that revenue has not shown: total revenue grew 1% last quarter. The third-quarter report, which the company has set for before the market opens on 2 December 2026, decides whether subscription growth catches up.
Sprinklr sells customer-experience software to large enterprises, covering social listening, customer service and marketing. In the quarter ended 31 July 2026, total revenue was $213.7 million, up 1% from a year earlier, and subscription revenue was $194.8 million, up 3%, according to the company's 2 September 2026 release.
The rally has already started to fade. The shares closed at $6.64 on 11 November 2026, down from $6.84 on 5 November 2026, and adjusted daily closes show them down 5.5% over three months. Company news since the 27 October 2026 marketing AI agents beta has been a 29 October 2026 research report and a 3 November 2026 vendor award, with no new customer or revenue figures.
What the price reflects: at $6.64 on 11 November 2026 the shares sit well above their 50-day and 200-day averages, and Daily Political listed a price-to-earnings ratio of 68.46 on 4 November 2026, a multiple that assumes growth well above last quarter's 1%. The rating is Low because the third-quarter guidance points to lower total revenue than a year ago. A report with subscription revenue clearly above the $197 million top of guidance and a raised fiscal 2027 outlook would prove the view wrong.
Bullish and bearish views on Sprinklr, Inc.
The bull case on Sprinklr, Inc. (CXM), in brief: contracted backlog is outgrowing revenue. The bear case: guidance points to lower total revenue.
Bull case
- Contracted backlog is outgrowing revenue. Remaining performance obligations, meaning contracted revenue not yet recognised, rose 11% to $1.03 billion at 31 July 2026, according to the 2 September 2026 release. That gives later quarters more booked revenue to draw on.
- The subscription outlook moved up. On 2 September 2026 the company raised its fiscal 2027 subscription revenue guidance to $782.5–$784.5 million and held total revenue at $866.5–$868.5 million, according to MarketBeat's call summary.
- A director bought on the open market. Stephen Ward Jr. bought 150,000 shares at $5.67 on 13 October 2026, according to his SEC Form 4 filed 15 October 2026.
- AI agents are reaching new distribution. The Voice of the Customer agent suite became available in Google's Gemini Enterprise Agent Marketplace on 22 October 2026, and a marketing AI agents beta followed on 27 October 2026, according to company releases.
- The business is profitable and holds cash. Non-GAAP operating income was $31.3 million, a 15% margin, and free cash flow was $13.1 million in the July quarter. Cash, equivalents and marketable securities were $452.9 million at 31 July 2026, according to the company release.
- Some analyst targets sit above the shares. Rosenblatt's target is $8.50 and UBS's is $7.50, both dated 3 September 2026. Daily Political counted three buy and four hold ratings on 4 November 2026.
Bear case
- Guidance points to lower total revenue. The company guided third-quarter total revenue to $215–$216 million, below the $219.1 million reported a year earlier in its 3 December 2025 release. Subscription revenue is guided to $196–$197 million, against $190.3 million a year earlier.
- Top-line growth is close to zero. Total revenue rose 1% in the July quarter. The $213.74 million figure missed the $214.45 million consensus, according to MarketBeat on 8 September 2026.
- Margins compressed year over year. Non-GAAP operating income fell to $31.3 million from $38.2 million, and the margin fell to 15% from 18%, according to the 2 September 2026 release.
- Near-term bookings are barely growing. Current remaining performance obligations, the part due within twelve months, grew 3% to $614 million at 31 July 2026. That rate matches subscription revenue growth.
- Insiders have been steady sellers. SEC Form 4 filings show general counsel Jacob Scott selling 16,407 shares at $6.97 on 2 November 2026 and chief executive Rory Read selling 203,666 shares at $5.17 on 1 October 2026, both under pre-arranged Rule 10b5-1 plans. On 15 September 2026 and 16 September 2026 the chief technology officer, chief administrative officer, chief information officer, general counsel and director Ragy Thomas all sold at $5.55 to $5.73.
Price setup
The shares closed at $6.64 on 11 November 2026, 19.8% below the 52-week intraday high of $8.28 set on 31 August 2026. The 52-week closing low was $4.82 on 29 September 2026, so the October rally recovered most of the post-report drop without regaining the August peak.
As of 11 November 2026 the 50-day moving average was $5.91 and the 200-day moving average was $5.83, and the shares trade above both. The three-month reference close was $7.03 on 13 August 2026, which the shares have not regained.
Insider prices mark the range of the past two months: the cluster of executive sales at $5.55 on 16 September 2026, the chief executive's $5.17 sale on 1 October 2026, the director's $5.67 purchase on 13 October 2026 and the general counsel's $6.97 sale on 2 November 2026. A return toward the moving averages would leave the October gain largely erased, which fits the view that the shares lag.
Catalysts ahead
- 2 December 2026: Q3 fiscal 2027 results, before the market opens, with an 8:30 a.m. ET call. Shows whether AI-agent launches lift subscription revenue above the $196M-$197M guidance and current backlog growth above 3%, or whether the October rally ran ahead of the numbers.
What would change the view
A daily close above $8.21, the 31 August 2026 close made on the day of the 52-week intraday high, which would show the shares leading the S&P 500; third-quarter subscription revenue above $197 million with a raised fiscal 2027 outlook would also prove the call wrong.
What it trades with
The October move followed company news: the 13 October 2026 director purchase, the 22 October 2026 marketplace listing and the 27 October 2026 agents beta. Daily Political listed a beta, a measure of sensitivity to the wider market, of 0.67 on 4 November 2026, so the shares have tracked company events more than the index. The nearest shared driver is investor sentiment toward enterprise software as larger platforms ship their own AI agents, which the listing inside Google's marketplace places Sprinklr close to. The 2 December 2026 report is the company-specific test; a cut to subscription guidance there would show that competitive pressure reaching Sprinklr's own numbers.
The evidence, claim by claim (8)
- Sprinklr scheduled its third-quarter results for before the market opens on 2 December 2026, with a conference call at 8:30 a.m. ET Sprinklr financial calendar announcement, 10 November 2026 · as of
- Q2 FY27 total revenue $213.7M, up 1% year over year; subscription revenue $194.8M, up 3% Sprinklr Q2 FY27 results release · as of
- Remaining performance obligations $1.03B, up 11%; current remaining performance obligations $614M, up 3% Sprinklr Q2 FY27 results release · as of
- Q3 FY27 guidance: subscription revenue $196M-$197M, total revenue $215M-$216M, non-GAAP operating income $33.5M-$34.5M Sprinklr Q2 FY27 results release; Earnings Whispers summary · as of
- Q3 FY26 total revenue $219.1M, up 9%; subscription revenue $190.3M, up 5% Sprinklr Q3 FY26 results release · as of
- FY27 guidance: subscription revenue $782.5M-$784.5M, total revenue $866.5M-$868.5M, non-GAAP EPS about $0.47 Sprinklr Q2 FY27 results release; MarketBeat call summary · as of
- General counsel Jacob Scott sold 16,407 shares at $6.97 under a Rule 10b5-1 plan SEC Form 4 filed 4 November 2026 · as of
- Director Stephen Ward Jr. bought 150,000 shares on the open market at $5.67 SEC Form 4 filed 15 October 2026 · as of
Sources
- Sprinklr publishes update to financial calendar · rallies.ai ·
- Sprinklr (NYSE:CXM) Stock: Insider Jacob Scott Sells 16,407 Shares · dailypolitical.com ·
- Sprinklr Announces Third Quarter Fiscal 2026 Results · businesswire.com ·
- MarketBeat ·
- Earnings Whispers
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