GitLab shows growth potential despite market concerns
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Nov 22 2025
0mins
Should l Buy GTLB?
Source: Coinmarketcap
GitLab Inc. (GTLB) experienced a decline of 6.70% as it crossed below its 5-day SMA, reflecting a challenging trading environment.
Despite this drop, GitLab's forward P/S ratio stands at 4.8 times, and the company has consistently reported revenue growth between 25% to 35%. The shift to a hybrid seat-plus-usage model indicates its adaptability in the competitive AI landscape, even amid concerns about AI's impact on software developers.
This performance suggests that GitLab remains a competitive player in the market, with potential for future growth despite current price pressures.
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Analyst Views on GTLB
Wall Street analysts forecast GTLB stock price to rise
24 Analyst Rating
13 Buy
10 Hold
1 Sell
Moderate Buy
Current: 28.980
Low
34.00
Averages
50.86
High
72.00
Current: 28.980
Low
34.00
Averages
50.86
High
72.00
About GTLB
GitLab Inc. provides DevSecOps Platform, is built on a single codebase, unified data model, and user interface. The Company offers customers flexible deployment options, including a self-managed offering, as well as multi-tenant and single-tenant (GitLab Dedicated) software-as-a-service (SaaS) solutions. It offers the DevSecOps Platform in three different subscription tiers, namely Free, Premium and Ultimate. The DevSecOps Platform enables its customers to move their DevOps workflow across any hybrid or multi-cloud environment. Its subscription plans are available as a self-managed offering that customers download to run in their own on-premises environment or hybrid cloud environments, and also a SaaS offering, which is offered as either multi-tenant or single-tenant (called GitLab Dedicated). The Company also provides related training and professional services. Its SaaS products provide access to hosted software as well as support.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
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- Strong Revenue Growth: The company has consistently achieved revenue growth between 25% and 35% over the past two years, driven by new customer acquisitions and existing customer expansions, with a remarkable 119% dollar-based net retention rate over the past 12 months, highlighting customer stickiness.
- Pricing Model Shift: GitLab is transitioning to a new hybrid seat-plus-usage pricing model aimed at boosting average revenue per user (ARPU), and while investors express concerns over price uncertainty, this strategy is expected to enhance customer loyalty.
- Opportunities from AI: Despite fears that AI may reduce the number of programmers, GitLab is likely to benefit from the trend of vibe-coding, as all code, regardless of the author, must be securely stored and reviewed, ensuring the platform's relevance and security.
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- Poor Stock Performance: GitLab's shares fell 33% last year due to a combination of slowing revenue growth, high valuation, and declining customer retention, leading investors to adopt a wait-and-see approach regarding its AI strategy, which negatively impacted market confidence.
- Slowing Revenue Growth: Although the company reported a 25% year-over-year revenue increase to $244.4 million in Q3, market expectations for future growth remain pessimistic, particularly with concerns that generative AI may pose a threat rather than an opportunity for the company.
- Significant Valuation Decline: GitLab now trades at a price-to-sales ratio of just 6, a substantial decrease from one or two years ago, indicating market apprehension about its future profitability despite the overall strong performance of tech stocks.
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- Nvidia's Investment Value: Nvidia (NVDA) is currently trading at a forward P/E ratio of about 23 times, which is undervalued given its 62% revenue growth last quarter, indicating significant future growth potential amidst ongoing AI infrastructure spending.
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- GitLab's Growth Potential: GitLab (GTLB) has a forward P/S ratio of just 4.8 times, and despite concerns about AI impacting software developers, it has consistently grown revenue by 25% to 35% and is shifting to a hybrid seat-plus-usage model, indicating its competitiveness in the AI era.
- Market Competition Analysis: While Nvidia faces competition from AI-specific integrated circuits, its chips' versatility and the established code on its CUDA platform allow it to maintain a significant share of AI infrastructure spending, suggesting these stocks are attractive investments in the current market environment.
See More
GitLab's Stock Struggles but Future Looks Promising
- Stock Performance Decline: GitLab's share price fell over 10% in 2024 and another 33% in 2025; however, 2026 could be pivotal for the company to prove the bears wrong, indicating market optimism about its future.
- Strong Revenue Growth: The company has consistently achieved revenue growth between 25% and 35% over the past two years, driven by new customer acquisitions and existing customer expansions, with a remarkable 119% dollar-based net retention rate over the past 12 months, highlighting customer stickiness.
- Pricing Model Shift: GitLab is transitioning to a new hybrid seat-plus-usage pricing model aimed at boosting average revenue per user (ARPU), and while investors express concerns over price uncertainty, this strategy is expected to enhance customer loyalty.
- Opportunities from AI: Despite fears that AI may reduce the number of programmers, GitLab is likely to benefit from the trend of vibe-coding, as all code, regardless of the author, must be securely stored and reviewed, ensuring the platform's relevance and security.
See More
GitLab's Stock Struggles Despite Strong Growth
- Stock Performance Issues: GitLab has seen its stock price decline over 10% in 2024 and another 33% in 2025, despite achieving consistent revenue growth of 25% to 35% over the past two years, indicating market concerns about its future prospects.
- Strong Customer Retention: The company boasts a 119% dollar-based net retention rate over the past 12 months, primarily driven by seat expansion and upgrades to higher-tier services, reflecting the stickiness of its platform and customer loyalty.
- AI Transformation Opportunities: While there are fears that AI may reduce the number of programmers, GitLab is evolving into an end-to-end software development lifecycle platform that leverages AI agents to assist developers, enhancing its competitive edge in secure code storage.
- Attractive Valuation: With a forward price-to-sales ratio of approximately 5.5 times and a forward price-to-earnings ratio of 24.5 times, GitLab appears to have significant upside potential in light of the opportunities presented by AI, although investors remain cautious about its new pricing model.
See More
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- Investor Opportunities: Investors may benefit financially when these buyout deals are officially announced.
See More
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- Ecosystem Development: IonQ is aggressively acquiring technologies to reduce system size and improve data transmission speed, aiming to build a complete quantum ecosystem that positions it favorably for commercialization.
- AI Agent Opportunity: UiPath's AI agent orchestration platform can manage agents from multiple vendors, leveraging its leadership in robotic process automation to significantly increase market share and drive company growth.
- GitLab's Potential: GitLab's current market cap is less than 5.5 times its projected 2026 sales; despite concerns over AI replacement, its secure platform is expected to benefit from increased software development, leading to continued strong revenue growth.
See More
GitLab (GTLB) Shares Drop 33% Amid AI Strategy Concerns
- Poor Stock Performance: GitLab's shares fell 33% last year due to a combination of slowing revenue growth, high valuation, and declining customer retention, leading investors to adopt a wait-and-see approach regarding its AI strategy, which negatively impacted market confidence.
- Slowing Revenue Growth: Although the company reported a 25% year-over-year revenue increase to $244.4 million in Q3, market expectations for future growth remain pessimistic, particularly with concerns that generative AI may pose a threat rather than an opportunity for the company.
- Significant Valuation Decline: GitLab now trades at a price-to-sales ratio of just 6, a substantial decrease from one or two years ago, indicating market apprehension about its future profitability despite the overall strong performance of tech stocks.
- Increased Competitive Pressure: GitLab faces heightened competition from GitHub, owned by Microsoft, leading investors to question its ability to sustain growth and profitability in the AI era, especially following guidance that fell short of market expectations.
See More
