GitLab’s Softening Growth And SMB Weakness Sparks Multiple Price Target Cuts

• Barclays cut GitLab’s price target to $42 from $44.
• GitLab’s stock traded over 8% lower in Wednesday’s premarket. 
• GitLab’s Q3 revenue climbed 25% year-over-year to $244 million, but the company incurred a loss per share (EPS) of $0.05.

GitLab Inc. (GTLB) has drawn cautious remarks from multiple Wall Street analysts after its third-quarter earnings, with several major brokerages trimming price targets amid signs of softening growth.

Despite GitLab delivering a solid quarter overall, analysts pointed to lagging contract‑backlog growth, decelerating subscription revenue expansion, and a conservative outlook for next year’s performance, according to TheFly.

Slow Payoff From New Strategy

Barclays analyst Raimo Lenschow cut the price target to $42 from $44 and stated that while enterprise and Ultimate-tier subscriptions continue fueling GitLab’s long-term potential, the revamped go-to-market approach is not expected to deliver meaningful impact in the near term. 

Goldman Sachs cut its target from $48 to $42 and held a ‘Neutral’ rating. Additionally, UBS trimmed its valuation to $51 from $60, and maintained a ‘Buy’ view. 

During the third-quarter earnings call, GitLab’s interim CFO, James Shen, warned that even though the results so far this year have been solid, the slowdown among small and mid-sized (SMB) customers is still happening. 

GitLab’s stock traded over 8% lower in Wednesday’s premarket. On Stocktwits, retail sentiment around the stock remained in ‘extremely bullish’ territory, and message volume shifted to ‘extremely high’ from ‘high’ levels in 24 hours. 

Financial Metrics

GitLab’s Q3 revenue climbed 25% year-over-year to $244 million, but the company incurred a loss per share (EPS) of $0.05 against an earnings per share of $0.17 last year. Adjusted EPS was 0.25. 

Both revenue and adjusted EPS exceeded the analysts’ consensus estimate of $239.32 million and $0.2, respectively, according to Fiscal AI data. 

Shen said that the company ended Q3 with 10,475 customers with annual recurring revenue (ARR) of at least $5,000, accounting for over 95% of total ARR. Its largest cohort, exceeding $100,000 ARR, expanded 23% YoY.  

GTLB stock has lost 23% in 2025 and 32% in the last 12 months. 

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