N-able, a data protection vendor focused on Managed Service Providers (MSPs), has released solid financial results for the first quarter of 2026. The company managed to cut its net loss, yet its growth momentum has cooled down, as its strategy of targeting large-scale clients prolongs sales turnaround times.
The firm posted a quarterly revenue of $133.7 million, surpassing its upper forecast threshold of $132 million and marking a 13.1% year-over-year increase. It recorded a GAAP net loss of $600,000, a substantial improvement from the $7.2 million deficit in the same period last year. N-able achieved continuous profitability for 15 quarters until late 2024; nevertheless, it has incurred losses in four out of the latest five quarters.
John Pagliuca, President and Chief Executive Officer of N-able, commented: “We have delivered a robust Q1 performance, backed by improved customer retention and steady business advancement across all segments. As artificial intelligence further complicates cyber threats and IT infrastructures, the cybersecurity industry is approaching a critical turning point. Our tailored platform is perfectly built for this shifting landscape. Embedded within customers’ existing operational systems, it automates repetitive manual work that previously relied on service support. This empowers our business partners to expand their scale efficiently while bolstering cybersecurity defenses.”
The company witnessed notable progress in channel sales expansion. During the earnings briefing, Pagliuca stated: “We have established a mature MSP business model, serving 25% of CRN’s Top 150 MSPs. Coupled with the growing scale of our Value-Added Reseller (VAR) network, our extensive channel coverage enables us to capture market-wide business demands.”
He further added: “The User End-point Management (UEM) solution has demonstrated tangible market value in practical deployment, with six of our top ten newly acquired customers adopting our UEM product.”
Jason Ader, an analyst from William Blair, pointed out: “Four of the top five new client acquisitions this quarter came from the VAR channel. The UEM solution gained strong traction in this channel thanks to the integrated optimization of endpoint management and security tools. It complements the mature MSP sales system and helps the company secure larger initial transaction amounts.”
Ader also mentioned N-able’s steady progress in tapping into the mid-to-high-end market. The number of clients with an Annual Recurring Revenue (ARR) of over $50,000 surged by 312 year-over-year to 2,710, contributing 62% to the total ARR. Meanwhile, clients with ARR exceeding $100,000 accounted for 41% of overall recurring revenue. The management team admitted that acquiring large and sophisticated enterprise clients brings longer sales cycles and stricter ROI evaluation standards, which is factored into the full-year financial forecast.
The revenue projection for the second quarter is set at $138 million (with a fluctuation range of ±$250,000), representing a 5.2% year-over-year growth rate — a conspicuous slowdown compared with the 13.1% growth in Q1. Ader explained: “The conservative quarterly guidance stems from prudent expectations for new product monetization. Longer sales cycles are inevitable as the company targets six-figure contracts and multi-year seven-figure deals, which usually require approval from senior executives or corporate boards.”
The full-year revenue forecast for 2026 remains unchanged at $556.5 million (±$25 million), equating to an 8.8% year-over-year growth rate.
At present, the synergistic effect of AI and cybersecurity on N-able’s business growth remains relatively inconspicuous.
Pagliuca explained that integrating AI assistance into the UEM system will drastically reduce repetitive operational workloads for technical staff. “This initiative continues our transformation from labor-dependent services to software-driven solutions, and we hold high expectations for its performance. We are embedding agentic AI technology to cut manual workloads for MSP partners, helping them improve operational efficiency and profitability.”
N-able is also developing a Disaster Recovery-as-a-Service (DRaaS) solution. As revealed by Pagliuca: “The DRaaS product is currently in limited preview and has been delivered to selected clients. We plan to complete its official launch in the second half of this year.”
In addition, a Google Workspace security protection tool is scheduled to roll out later this year, which is now in the limited preview phase with pre-ordered clients. Together with the DRaaS solution, the two new products are expected to accelerate N-able’s revenue growth. Pagliuca noted: “These diversified offerings will elevate our customer win rate. Moreover, cross-selling strategies based on new products will further drive business expansion.”
It is anticipated that N-able will return to profitability and sustain double-digit revenue growth in the future.
Beijing Qianxing Jietong Technology Co., Ltd.
Sandy Yang/Global Strategy Director
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Email: yangyd@qianxingdata.com
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