Published on: 2026-09-09
Updated on: 2026-09-09
ServiceTitan stock fell about 20% in extended trading after fiscal Q2 2027 results exceeded Wall Street expectations on revenue and adjusted EPS.
Revenue rose 21% to $292.8 million and adjusted diluted EPS reached $0.40, yet current guidance implies Q3 revenue growth of only about 14.8% and second-half growth near 15.2%, down from roughly 22.7% in H1.
Slower transaction growth, softer customer job activity, MAX-related revenue timing and a sales leadership transition reinforced a forward outlook that looked considerably weaker than the quarter just reported.
| Metric | Figure | Signal |
|---|---|---|
| Q2 revenue | $292.8M, +21% | Above consensus |
| Adjusted EPS | $0.40 | Above consensus |
| Q3 revenue midpoint | $286M | Slightly below consensus |
| Implied Q3 growth | ~14.8% | Decelerating |
| Q2 GTV | $26.8B, +17% | Slower activity |
| Implied H2 growth | ~15.2% | Key pressure |
ServiceTitan’s $286 million Q3 revenue midpoint sits only about 0.7% below the roughly $287.9 million Wall Street consensus, too small a gap by itself to explain the scale of the repricing. Full-year revenue guidance of $1.139 billion to $1.144 billion was also raised from the previous range.
ServiceTitan generated $561.6 million in H1 FY27, approximately 22.7% above the same period last year. Using the midpoint of current full-year guidance, H2 revenue would reach roughly $579.9 million. Against about $503.2 million in H2 FY26, that implies growth of approximately 15.2%. The H1 figure is derived from ServiceTitan’s reported Q1 and Q2 revenue, while the H2 estimate uses the midpoint of current FY27 guidance.
Q3 reinforces that slowdown. A $286 million midpoint against $249.2 million a year earlier implies approximately 14.8% YoY growth.
A 0.7% guidance miss alone does not explain the scale of the repricing. The more consequential change is revenue growth moving from roughly 23% in H1 toward 15% in H2.
Gross transaction volume reached $26.8 billion in Q2, up 17% YoY. Management said normalized GTV growth was around 200 basis points below recent quarters as existing customers generated fewer jobs. Lead growth also slowed during May and June before stabilising in July, and the company carried the softer Q2 pattern into its second-half forecast rather than assuming the July improvement would persist.
Fewer leads can produce fewer booked jobs, reducing transaction activity through ServiceTitan’s platform and limiting usage-linked revenue growth.
Net dollar retention remained above 110%, pointing to weaker activity within existing accounts rather than a broad customer-retention problem. Subscription revenue still grew 22% and usage revenue rose 24%, keeping the pressure concentrated in slower activity rather than outright contraction.
ServiceTitan beat Wall Street’s adjusted earnings expectation, with non-GAAP diluted EPS of $0.40 versus approximately $0.35 expected. Revenue of $292.8 million also exceeded the roughly $285.9 million consensus.
On a GAAP basis, ServiceTitan reported a diluted loss of $0.26 per share, while Investing.com’s earnings dataset carried an estimate for a $0.25 loss. That produces a one-cent GAAP miss on that comparison.
The difference reflects expenses and other items excluded from ServiceTitan’s non-GAAP calculation but retained under GAAP. Revenue and adjusted EPS therefore exceeded expectations, while GAAP EPS did not beat the estimate carried by that dataset.
Profitability still improved on the company’s adjusted operating measures. Non-GAAP operating margin expanded to 15.2% from 12.1% a year earlier, while non-GAAP free cash flow rose 47% to $50.5 million.
ServiceTitan expects the growing mix of MAX contracts to create a $2 million to $3 million subscription revenue headwind over the remainder of FY27 because billing ramps more slowly than core subscription revenue. MAX contracts typically are not billed during the first quarter and then progress toward full contract value through roughly the first year.
Waived onboarding fees for existing customers moving to MAX add further pressure through lower professional-services revenue, taking the combined near-term revenue effect to roughly $4 million to $5 million.
MAX adoption is accelerating despite that short-term drag. Locations more than doubled during Q2, and ServiceTitan expects more than 700 enrolled locations by fiscal year-end. At full contract ramp, management says subscription revenue from existing customers moving to MAX can roughly double relative to prior spending.
Part of the second-half slowdown therefore reflects delayed monetisation rather than weaker demand alone. Higher MAX adoption only strengthens the longer-term case if that deferred revenue converts while GTV growth stabilises.
Customer activity now provides the clearest test of whether the mid-teens growth implied for H2 is temporary. Stronger lead volumes and GTV would support a recovery in usage growth, while faster MAX conversion would show that today’s billing drag is translating into higher future subscription economics.
Improving operating leverage offers a counterweight to the slower top-line outlook. ServiceTitan raised FY27 non-GAAP operating income guidance to $152 million to $154 million, while management expects full-year incremental margins of 33%.
The sales leadership transition adds another execution variable rather than changing the central growth thesis. Chief Revenue Officer Ross Biestman is set to hand the role to long-time ServiceTitan sales executive Rikus Pretorius in Q4, providing internal continuity while the company changes its sales motion around MAX.
The dividing line is whether mid-teens growth becomes ServiceTitan’s new baseline. A recovery in GTV and job activity alongside stronger MAX monetisation would support a temporary slowdown; persistent transaction weakness would point to a more durable reset.
