Barclays Turns Cautious on GitLab Inc. (GTLB) Amid Growth and Competitive Concerns

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On January 12, Barclays analyst Raimo Lenschow downgraded GitLab Inc. (NASDAQ:GTLB) to Underweight from Equal Weight and lowered the firm’s price target to $34 from $42 as part of its 2026 software sector outlook. While Barclays sees a broadly favorable backdrop for software in 2026—supported by stable macro conditions, steady IT spending, and compressed valuations—the firm expects GitLab to face company-specific headwinds. These include growth deceleration as prior pricing actions are lapped, alongside concerns around management turnover and an increasingly competitive and fast-evolving DevSecOps landscape, which Barclays believes could weigh on the stock’s near-term setup.

Operationally, GitLab Inc. (NASDAQ:GTLB) continued to deliver solid results in the most recent quarter. During its third quarter fiscal year 2026 earnings call, the company reported revenue of $244 million, representing 25% year-over-year growth and exceeding the top end of its guidance by two percentage points. The performance highlights ongoing customer demand for GitLab’s unified DevSecOps platform, even as the company navigates a more normalized growth environment following several years of elevated expansion.

GitLab is an all-remote software company founded in 2011 and headquartered in San Francisco, offering an open-core platform that integrates planning, development, security, and operations into a single application. While Barclays’ downgrade reflects expectations for moderating growth and execution risks, GitLab Inc. (NASDAQ:GTLB)’s ability to consistently outperform guidance suggests the business remains fundamentally resilient.

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