The revenue beat and strong cloud/AI growth are positive, but the sharp decline in GAAP and non-GAAP profitability is a significant concern. Monitor the Q3 earnings call for commentary on margin trajectory and whether the EPS guidance raise is achievable without further margin compression. The stock may trade on the cloud growth narrative but faces headwinds from declining earnings.
Price Chart
Executive Summary
NICE reported Q2 2026 results with total revenue of $782.3M (+7.6% YoY), exceeding the high end of its guidance range. Cloud revenue grew 12.6% YoY to $609.0M, and AI ARR reached $362M (15% of cloud revenue). However, GAAP operating income fell sharply to $104.0M (13.3% margin) from $160.6M (22.1% margin) a year ago, and GAAP diluted EPS dropped to $1.40 from $2.96. Non-GAAP diluted EPS also declined to $2.70 from $3.01. The company raised full-year 2026 non-GAAP EPS guidance to $11.06-$11.26 but reiterated revenue guidance of $3,170M-$3,190M. The strong cloud and AI metrics are offset by declining profitability and EPS, making the overall picture mixed.
Key Facts
- Q2 2026 total revenue $782.3M, up 7.6% YoY from $726.7M
- Cloud revenue $609.0M, up 12.6% YoY
- GAAP operating income $104.0M (13.3% margin) vs $160.6M (22.1% margin) YoY
- GAAP diluted EPS $1.40 vs $2.96 YoY
- Non-GAAP diluted EPS $2.70 vs $3.01 YoY
- AI ARR reached $362M, representing 15% of cloud revenue
- Full-year 2026 non-GAAP EPS guidance raised to $11.06-$11.26
- Full-year 2026 revenue guidance reiterated at $3,170M-$3,190M
- Q2 operating cash flow $122.7M; $58.0M used for share repurchases
- Cash and short-term investments $354.7M with no outstanding debt
Financial Impact
Revenue beat guidance high-end by undisclosed amount; GAAP operating income declined 35% YoY; GAAP net income declined 56% YoY; Non-GAAP net income declined 16% YoY
Risk Factors
- GAAP operating margin compressed from 22.1% to 13.3% YoY due to rising operating expenses
- Non-GAAP operating margin declined from 30.2% to 25.3% YoY
- GAAP net income nearly halved YoY; non-GAAP net income also declined
- Share count declining (buybacks) masks underlying EPS deterioration on a comparable basis
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 6-K Filing (Primary) | 0001178913-26-003846 |
| Document: zk2635855.htm | 0001178913-26-003846 |
| Document: 0001178913-26-003846-index-headers.html | 0001178913-26-003846 |
| Document: 0001178913-26-003846-index.html | 0001178913-26-003846 |
| Document: 0001178913-26-003846.txt | 0001178913-26-003846 |
Track record builds as more directional reports settle.
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Sep 9, 2026 23d ago | 6-K | $98.87 $102.28 | ▲ +3.45% | ▲ +3.78% | $113.90 (+15.20%) |
Aug 6, 2026 8w ago | 6-K | $97.11 $105.25 | ▲ +8.38% | ▲ +7.17% | $113.90 (+17.29%) |
Aug 5, 2026 8w ago | 6-K | $99.35 $98.56 | ▼ −0.80% | ▼ −1.15% | $113.90 (+14.65%) |
Jul 8, 2026 12w ago | 6-K | $96.80 $102.28 | ▲ +5.66% | ▲ +4.80% | $113.90 (+17.67%) |
Feb 28, 2026 30w ago | Institutional Cluster | $116.38 $125.63 | ▲ +7.95% | ▲ +9.16% | $113.90 (−2.13%) |
US Market Status
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