Manhattan Associates’ first quarter results were marked by strong demand for its cloud-based supply chain solutions and early traction in artificial intelligence deployments, which led to a positive market reaction. CEO Eric Clark pointed to 24% year-over-year growth in cloud revenue and highlighted that over half of new bookings came from net new customers, supported by a diverse set of wins across retail, distribution, and industrial sectors. Management credited recent investments in go-to-market initiatives and the company’s ability to win deals through the Google Cloud Marketplace for driving deal volume, while also noting progress in embedding AI agents into customer workflows to improve operational efficiency.
Is now the time to buy MANH? Find out in our full research report (it’s free for active Edge members).
Manhattan Associates (MANH) Q1 CY2026 Highlights:
- Revenue: $282.2 million vs analyst estimates of $273.2 million (7.4% year-on-year growth, 3.3% beat)
- Adjusted EPS: $1.24 vs analyst estimates of $1.11 (11.3% beat)
- Adjusted Operating Income: $91.46 million vs analyst estimates of $84.68 million (32.4% margin, 8% beat)
- The company slightly lifted its revenue guidance for the full year to $1.15 billion at the midpoint from $1.14 billion
- Management raised its full-year Adjusted EPS guidance to $5.33 at the midpoint, a 4.1% increase
- Operating Margin: 23%, down from 24% in the same quarter last year
- Billings: $301.8 million at quarter end, up 7.8% year on year
- Market Capitalization: $8.16 billion
While we enjoy listening to the management's commentary, our favorite part of earnings calls are the analyst questions. Those are unscripted and can often highlight topics that management teams would rather avoid or topics where the answer is complicated. Here is what has caught our attention.
Our Top 5 Analyst Questions From Manhattan Associates’s Q1 Earnings Call
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Terrell Tillman (Truist Securities) asked about the progression from AI pilot programs to scaled revenue. CEO Eric Clark explained that paid pilots are converting to subscriptions, with more impact expected in 2027, and clarified that most agents can operate autonomously if customers choose.
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Brian Peterson (Raymond James) questioned the sustainability of strong RPO growth and underlying deal dynamics. Clark emphasized that increased deal volume and diversification across regions and verticals are reducing reliance on large deals, supporting steady pipeline growth.
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Joseph Vruwink (Baird) probed whether on-premise customers are accelerating cloud migration due to AI needs. Clark confirmed a shift in customer mindset, noting that 23% of the base is now converting or has started converting, with modernization and AI access driving urgency.
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George Kurosawa (Citi) sought clarification on the sustainability of cloud revenue drivers. CFO Linda Pinne explained that some overage fees were one-time and that lower churn supported growth, but guided conservatively for the remainder of the year based on macro volatility.
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J. Lane (Stifel) asked about customer reception to the subscription pricing model for AI agents. Clark stated the model is designed for simplicity, with uplift determined during pilots and contracts structured to grow alongside customer usage, balancing consumption-based costs.
Catalysts in Upcoming Quarters
In the coming quarters, the StockStory team will monitor (1) the pace at which AI agent pilots convert to recurring subscriptions and the resulting revenue uplift, (2) continued momentum in cloud migration and modernization among existing customers, and (3) the effectiveness of expanded sales and services teams in driving deal volume and pipeline growth. Execution on cross-selling new AI capabilities and the ability to maintain operating margins amid macro volatility will also be key signposts for sustained performance.
Manhattan Associates currently trades at $139.95, up from $134.89 just before the earnings. Is there an opportunity in the stock?The answer lies in our full research report (it’s free).
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