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Samsara continues to focus on large customer value as revenue grows 37% year-over-year

Derek du Preez Profile picture for user ddpreez June 7, 2024
Summary:
Samsara continues to navigate challenging macro conditions, as large operations customers seek solutions to reduce cost and improve safety.

Sanjit Biswas
(Samsara)

Samsara has released its Q1 2025 earnings and is showing continued strength amongst large customers, delivering solid growth for the quarter. The numbers come just a couple of weeks before Samsara’s annual user event - Beyond - which this year is taking place in Chicago, where customers will come together to understand how the vendor is building out its Connected Operations Cloud to establish itself as a system of record provider for companies with large physical operations. 

During a call with analysts this week, CEO Sanjit Biswas said: 

Large customer momentum continues to fuel our growth. In Q1, we had wins with the Department of Transportation for both Iowa and Kansas and VINCI, a Fortune Global 500 construction company with more than 275,000 employees.

Our continued innovation and customer feedback loop drives our success with large customers. Over the past few months, I visited many of our largest customers in the US, Canada, Mexico, and Europe. Seeing their operations firsthand, it's clear that the toughest challenges and priorities in physical operations are universal.

The key figures for Q1 2025 include: 

  • Q1 revenue of $280.7 million, representing 37% year-over-year growth
  • Ending ARR of $1.176 billion, representing 37% year-over-year growth
  • 1,964 customers with ARR over $100,000, up 43% year-over-year

Commenting on the financials, highlighting the significance of Samsara’s focus on large customers, Chief Financial Officer Dominic Phillips said: 

The combination of more customers added and an increase in the average ARR per customer grew our ARR mix for $100,000-plus ARR customers to 53% in Q1, up from 49% one year ago and 45% two years ago.

Second, our customers increasingly utilize Samsara as a system of record for physical operations by subscribing to multiple applications all on one unified platform. 94% of our $100,000-plus ARR customers and 83% of our core customers subscribe to multiple Samsara products. We're also seeing multi-product adoption at scale. 

For full year 20'25, Samsara expects revenue to be between $1.205 billion and $1.213 billion, representing year-over-year adjusted revenue growth between 31% and 32%. 

Customer impact

During the earnings call, CEO Biswas pointed to a recent IDC survey, The Business Value of Samsara, which assessed the value of the Connected Operations Cloud on 130 of Samsara’s customers. The report found that customers realized more than 8x ROI on average, representing $2 million of savings per customer per year. Biswas noted: 

Samsara customers achieved these savings from reducing costs related to vehicle-related crashes and insurance, spending less on fuel, lowering maintenance costs and extending vehicle life spans, minimizing lost revenue associated with vehicle availability, and increasing driver productivity. We are proud to partner with our customers to help them drive meaningful impact in their organizations.

Our customers have large complex operations that are asset and labor-intensive. They often require tens of thousands of frontline workers and assets to build the infrastructure supporting our global economy. At this scale, our customers' top priorities are often safety and sustainability. It's critical to how they run the organizations.

When diginomica last sat down with Biswas, he spoke about the flywheel effect that the company’s data platform provides for asset intensive customers and pointed to how the vendor is building out its product portfolio to establish itself as the system of record for companies with large physical operations. 

During the earnings call, Biswas pointed to two customers that are seeing results. Firstly, a provider of agriculture inputs and services, Nutrien Ag Solutions, is focused on using Samsara to improve safety: 

They are using our video-based safety application to improve driver safety for their North American commercial fleet. They've seen good results as they reported in their most recent sustainability report. In 2023, they saw a 40% reduction in unsafe driving practices, including speaking - speeding, harsh braking, and distracted driving. They use Samsara on more than 11,000 vehicles with plans to continue expansion.

Secondly, Biswas pointed to Frontier Communications, a provider of broadband and digital television services, which is using Samsara to improve its sustainability metrics: 

They are using Samsara to optimize fuel efficiency and reduce fuel costs across their fleet. They installed our Telematics application in 8,100 vehicles, saving them 320,000 gallons of fuel in 2023. This equals more than 6 million pounds of carbon. Both of these organizations are taking a data-driven approach to help them achieve their ambitious goals and make the greatest impact.

Speaking to Samsara’s long-term strategy, Biswas was keen to highlight how the vendor is focusing on establishing itself as a system of record provider for these physical operations companies. He pointed to the vendor’s recently announced Connected Forms application, which is a workflow solution that allows frontline workers to carry out their work through digital forms: 

A good example of this is with one of the largest privately-owned drainage and wastewater utility specialists in the UK. They are a utility service provider with more than 3,800 employees and 3,000 assets. They have been a customer since 2020, starting with our video-based safety and telematics applications. 

This quarter, they expanded the partnership further with Connected Forms. Currently, they have more than 30 use cases for connected forms, including compliance, labor tracking, attendance, safety briefings, vehicle inspections and avoiding timesheet fraud. Their long-term vision is to have one system of record for their entire operations. This will enable them to manage all of their data and extract insights and value from one unified platform.

My take

Another solid quarter for Samsara. It’s still early days as the company builds out its platform approach for these physical operations companies that have largely been ignored in the cloud/connected workflow story we’ve seen over the past decade. diginomica will be on the ground in Chicago at the company’s Samsara user event, where we will be prioritizing the customer stories that showcase how this works in practice. 

 

 

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