Manhattan Associates Q1 Earnings Call Highlights

Manhattan beat expectations in Q1 with total revenue of $282 million (up 7% YoY; +13% ex-license/maintenance), cloud revenue up 24% to $117 million, RPO up 24% to $2.35 billion, and management raised full-year guidance for revenue, adjusted operating margin and EPS while maintaining the RPO target of $2.62–2.68 billion.

The company’s agentic AI offering, Active Agents, is showing strong early demand with paid 90-day pilots and customer ROI examples (faster order cycles, reduced exceptions), but Manhattan expects most monetization impact to materialize in 2027 rather than 2026.

Financial and capital actions: operating cash flow was $84 million, the company ended the quarter with $226 million cash and no debt, repurchased $150 million of shares (with $350 million remaining authorization), and added roughly 120 services hires to support deployments.

Manhattan Associates (NASDAQ:MANH) reported first-quarter 2026 results that management described as a “strong start” to the year, citing better-than-expected revenue and profitability, accelerating cloud growth, and a sharp increase in remaining performance obligations (RPO). The company also raised its full-year outlook for total revenue, operating margin, and earnings per share, while maintaining its annual RPO target range.

Quarterly results: cloud growth and improving services

President and CEO Eric Clark said Manhattan “navigat[ed] a volatile global macro” while delivering “record better than expected results,” highlighted by 24% growth in cloud revenue and continued improvement in services revenue growth.

Chief Financial Officer Linda Pinne, who recently stepped into the role after serving as Global Corporate Controller and Chief Accounting Officer, reported total revenue of $282 million, up 7% year over year. Excluding license and maintenance revenue, total revenue rose 13%, reflecting the company’s ongoing transition to cloud.

Cloud revenue: $117 million, up 24%.

Services revenue: $126 million, up 4%.

RPO: $2.35 billion, up 24% year over year and 5% sequentially.

Adjusted operating profit: $91 million, for a 32.4% adjusted operating margin.

Adjusted EPS: $1.24, up 4%.

GAAP EPS: $0.82, down 4%.

Pinne attributed the cloud revenue outperformance to “a combination of strong execution, catch-up overage fees, and lower than modeled churn rates of our renewal portfolio.” She later noted some overage fees were “one-time” and “would not be recurring,” and said the company was keeping its Q2–Q4 assumptions in line with what it previously shared due to macro volatility.

On profitability, Pinne said the quarter’s better-than-expected adjusted operating profit was driven by strong cloud revenue growth, which “offset some of the increased go-to-market investments” discussed last quarter. She added that GAAP EPS was pressured by higher-than-expected tax expense tied to “a decrease of stock-based compensation benefits.”

Bookings momentum lifts RPO; new logos remain a key driver

Management emphasized bookings strength and sales execution as key factors behind the RPO increase. Clark said investments made throughout 2025 to improve go-to-market effectiveness “have started to pay off in the first quarter and contributed to RPO increasing 24% to $2.35 billion.”

Clark also said new customer bookings “remain strong,” with “over 55% of new cloud bookings” coming from net new logos. He pointed to improved deal volume “across all deal types,” and noted a larger contribution from products beyond Active Warehouse, including Active Omni, Active Transportation, and Active Planning.

In Q&A, Clark told analysts deal volume increased broadly, reducing dependence on large deals. He said Manhattan’s “deal volume across all these types was up in Q1, so not nearly as dependent on large deals,” adding that the company’s two largest deals in the quarter came from Europe and APAC. He also said the company’s win rate metric has been “consistently above 70%,” and that renewal performance was “solid and supportive of the plan” discussed previously.

Pinne said contract duration remained about 5.5 to 6 years, with 38% of RPO expected to be recognized as revenue over the next 24 months.

Active Agents: pilots, early ROI examples, and monetization approach

Clark devoted a large portion of prepared remarks to Manhattan’s agentic AI offering, Active Agents, describing early demand as strong and saying the pilot program is “off to a better than expected start.” He outlined two components: “a set of base agents ready to be activated immediately,” and “Agent Foundry,” which enables customers to build and deploy their own agents on Manhattan’s Active platform.

Clark argued Manhattan’s architecture provides an advantage because customers “don’t need to implement costly and complex external data lakes,” citing an “API-first architecture” that can deploy agents “in minutes, not months.” He said the company already has “dozens of customers in various stages of AI maturity” and that Active Agents will feature prominently at its Momentum user conference next month, including an “Active Agent Boot Camp” designed to provide hands-on Agent Foundry experience.

Clark shared several early examples of customer impact, including a U.S. retail customer that saw a 5% improvement in order cycle times and reduced labor requirements in its largest distribution center using a custom Foundry agent. He also described a healthcare customer achieving a “double-digit % reduction in loading times and improvement in on-time shipment departures,” and cited a base Wave Coordinator Agent that reduced exceptions “by up to 75%” for one food distribution customer. He added that for an industrial distribution customer, the same agent increased “line shipped by over 30%” and improved order cycle times “by over 25%.”

On monetization timing, Clark said the initial go-to-market is through a “90-day pilot,” which is paid, with conversion to subscription discussed at the end of the pilot. He said those conversion conversations are beginning in Q2 and in some cases have “already begun.” Clark said the company is taking “a conservative approach to the monetization,” expecting a “bigger impact…in 2027 than…in 2026.”

Asked about autonomous operation, Clark said most agents can run autonomously if customers choose, starting with suggestions and then moving to autonomous action “when the user feels comfortable.”

Guidance raised; RPO target maintained

Pinne said the company raised its full-year 2026 outlook for total revenue, adjusted operating margin, and EPS following the Q1 beat, while keeping parameters for the rest of the year unchanged. “We took our beat from Q1 and we applied that to each one of our metrics,” she said, adding the company was being prudent given macro volatility.

For 2026, Manhattan continues to target RPO of $2.62 billion to $2.68 billion, representing 18% to 20% growth. The company’s updated full-year guidance includes:

Total revenue: $1.147 billion to $1.157 billion.

Adjusted operating margin: midpoint increased to 35% from 34.75%.

Adjusted EPS: $5.29 to $5.37.

GAAP EPS: midpoint raised to $3.59; Q2 GAAP EPS targeted at $0.86.

Cloud revenue: midpoint increased to $495 million, representing 21% growth.

Services revenue: expected to rise 3% to $518 million.

Pinne said foreign exchange was a 2-point tailwind to year-over-year total revenue growth in Q1, and in response to an analyst question, she said FX was “a little bit over 1% tailwind on the cloud revenue” in the quarter and that the company expects “about a 1% overall tailwind” on revenue for the full year.

Cash flow, buybacks, and staffing investments

Pinne reported operating cash flow of $84 million, up 12%, translating to a 28.3% free cash flow margin and a 33.1% adjusted EBITDA margin. Deferred revenue rose 20% year over year to $356 million. The company ended the quarter with $226 million in cash and no debt.

Manhattan repurchased $150 million of shares during the quarter and had $350 million remaining under the repurchase authorization announced in March, according to Pinne.

On hiring and services capacity, Clark said the company added “about 120 headcount into our services team” and had another “roughly 70 either pending start or open,” describing the additions as demand-driven. He said the forward-deployed engineer effort is staffed largely with people who have experience across Manhattan’s services engineering and R&D teams to support rapid deployment of agents and creation of custom agents through Agent Foundry.

Clark closed the call by thanking retiring CFO Dennis Story for his contributions over 20 years and expressing optimism about growth opportunities, citing a strong pipeline and continued innovation across Manhattan’s unified Active platform.

About Manhattan Associates (NASDAQ:MANH)

Manhattan Associates, Inc (NASDAQ: MANH) is a provider of supply chain and omnichannel commerce software solutions designed to optimize the flow of goods, information and funds across enterprise operations. Its flagship offerings include warehouse management, transportation management, order management and omnichannel fulfillment applications. These solutions are delivered through a cloud-native platform called Manhattan Active, which enables retailers, manufacturers, carriers and third-party logistics providers to orchestrate inventory, manage distribution and improve customer service in real time.

Key product areas include Manhattan Active Warehouse Management, which automates and optimizes warehouse operations from receiving through shipping; Manhattan Active Transportation Management, supporting carrier selection, routing and freight payment; and Manhattan Active Omni, which unifies order capture, inventory visibility and fulfillment across stores, distribution centers and e-commerce channels.