PCOR

Procore Technologies, Inc. (PCOR) - Q2 2026 10-Q Summary

Business Context and Reporting Period

This Quarterly Report on Form 10-Q covers the period ended June 30, 2026. Procore Technologies, Inc. is a leading global provider of cloud-based construction management software. The company operates as a single segment, generating revenue primarily through subscriptions to its platform used by owners, general contractors, and specialty contractors. As of July 24, 2026, the company had approximately 152 million shares of common stock outstanding.

Key Financial Metrics

Material Changes vs. Prior Period

• Revenue Growth: Revenue increased 16% year-over-year for both the quarter and the six-month period. Growth was driven by existing customers (88% of Q2 growth) and new customer acquisitions.
• Profitability: The company achieved net income of $16.9 million in Q2 2026, a significant turnaround from a net loss of $21.1 million in Q2 2025. This was aided by a tax benefit and improved operating leverage.
• Acquisitions:
  • Datagrid: Acquired in January 2026 for $168.0 million to accelerate AI strategy. Added $114.9 million to goodwill.
  • Novorender: Acquired in January 2025; purchase price accounting finalized.
• Lease Modifications: Strategic modifications to Carpinteria, CA office leases resulted in a one-time non-cash gain of $5.8 million, reducing rent expense and future contractual commitments by $29.7 million.
• Restructuring: In January 2026, the company reduced its global workforce by 4%, incurring $6.0 million in restructuring costs, all of which were paid by June 30, 2026.
• Stock Repurchases: The company repurchased 1.77 million shares for $100.0 million during the first six months of 2026 under its $300 million program.

Guidance, Outlook, and Risks

• DroneDeploy Acquisition: On July 27, 2026, Procore entered into an agreement to acquire DroneDeploy, Inc. for approximately $845.0 million in cash. The transaction is expected to close later in 2026. Procore has secured a $700 million bridge loan facility from Goldman Sachs to fund the deal.
• Outlook: Management expects to continue investing in AI (Procore AI), international expansion, and product development. The company maintains a full valuation allowance on U.S. deferred tax assets but expects to release portions as it generates taxable income.
• Key Risks:
  • Legal Proceedings: Ongoing trade secret litigation with Oracle America, Inc. regarding Procore Pay. Discovery has closed; the case is in the pre-trial phase. Potential damages are not estimable.
  • AI Integration: Risks associated with the development, deployment, and regulatory compliance of AI tools, including potential liability for AI-generated outputs.
  • Macroeconomic Factors: Sensitivity to construction industry spending, inflation, and interest rates.
  • Integration Risk: Challenges in integrating DroneDeploy and realizing anticipated synergies.

Investor Verification Checklist

• Verify the status and potential financial impact of the Oracle trade secret litigation (Note 9).
• Confirm the closing conditions and financing terms for the DroneDeploy acquisition (Note 15).
• Review the remaining performance obligations (RPO) of $1.67 billion to assess future revenue visibility.
• Monitor the stock repurchase program balance ($200 million remaining) and execution pace.
• Assess the impact of lease modifications on future operating expenses and cash flow.
• Track the integration progress of Datagrid and the realization of AI-driven revenue.