GitLab shares surged as much as 16% on Wednesday, touching a fresh 52-week high near $54.80, after the software company blew past Wall Street's expectations for its fiscal second quarter and raised its guidance for the rest of the year.

The DevOps platform maker reported total revenue of $286.3 million for the quarter, up 21% year over year and ahead of the roughly $273 million analysts had penciled in. Non-GAAP earnings came in at 24 cents per share, well above the 18-cent consensus estimate, even as the company posted a GAAP net loss of 22 cents per share.

GitLab's dollar-based net retention rate held at 117%, and the number of customers spending $100,000 or more annually climbed 17% year over year to 1,571. Total remaining performance obligations, a measure of contracted future revenue, rose 16% to $1.2 billion.

AI-native pricing model gains early traction

Executives pointed to early success from GitLab's newer consumption-based "Flex" pricing model, which the company said signed more than 130 customers committing over $20 million in its first six weeks on the market. Paid AI-consumption run rate jumped from $15 million in the first quarter to more than $40 million in the second, a sign that developers are increasingly paying for AI-assisted coding tools bundled into GitLab's platform.

"As AI drives more software creation, the context, security, governance and control GitLab provides become increasingly valuable," chief executive Bill Staples said in the company's earnings release.

Buoyed by the results, GitLab raised its full-year fiscal 2027 revenue guidance to a range of $1.129 billion to $1.133 billion, implying growth of 18% to 19% for the year, and lifted its non-GAAP operating income outlook to $148 million to $152 million. For the current quarter, the company guided to revenue of $281 million to $283 million.

The rally, which stock-tracking service StockTitan flagged as one of the sharpest single-day moves among software names this earnings season, pushed the stock roughly 20% above its Tuesday closing price at one point in premarket trading before settling to a gain of about 10% to 16% over the course of the session, according to multiple market trackers.

Wall Street analysts scrambled to lift their price targets in the results' wake. BofA Securities raised its target to $54 from $45, Rosenblatt lifted its target to $55 from $43 while keeping a Buy rating, RBC Capital moved to $60 citing new-logo and seat growth momentum, and Morgan Stanley pointed to revenue growth exceeding 20% in raising its own target to $57, according to notes tracked by Investing.com's analyst-ratings coverage.

The pop came even as GitLab's stock remains down slightly over the trailing twelve months, reflecting a rough stretch for high-growth software names earlier this year before the sector's recent recovery. The move also arrived on a broad up day for AI-linked software: cloud-infrastructure company Nutanix and other enterprise-software peers reported results in the same window, with investors rotating back into growth names as bond yields and oil prices eased from their recent spikes.

GitLab's next scheduled financial update is its third-quarter fiscal 2027 report, with the company guiding investors to expect revenue growth of 15% to 16% for that period — a deceleration from the second quarter's pace that some analysts flagged as worth watching even amid the broader enthusiasm.