NAVN · Research
Navan Grew Revenue 35.38% on Business Travel Bookings, but Stock Pay Was 27.29% of Revenue and Owner Cash Is Negative
Q2 fiscal 2027 revenue was $232.79M, 90.81% of it per-booking usage fees. Gross booking volume rose 45%.
| Scorecard | Read |
|---|---|
| Thesis | Navan keeps winning business travel and expense customers, and usage revenue scales faster than cost so operating losses close |
| What proves it wrong | Growth slows below 25% while sales and marketing keeps rising as a share of revenue, or stock pay stays near a quarter of revenue |
| Next catalyst | Q3 fiscal 2027 results in December 2026, the first quarter after the IPO anniversary, with gross booking volume and operating loss |
| Key multiple | GAAP EBITDA is -$152.75M, so EV / EBITDA carries no signal; 138.00x EV / operating cash flow |
| Debt | $125.04M at Jul 31, 2026: $118.17M warehouse facility secured by card receivables, $6.00M ABL and $0.87M notes |
| Stock pay | $225.35M from the cash flow line, 27.29% of revenue |
What Navan sells
Navan is a cloud platform for business travel, corporate cards and expense management [1]. Companies use it to book trips, set travel policy, pay with Navan cards and reconcile expenses.
It operates as one segment.
Q2 fiscal 2027 revenue, the quarter to Jul 31, 2026, was $232,790K against $171,952K, up 35.38% [1]. Six-month revenue was $453,021K, up 37.52%.
Usage-based revenue was $211,393K, or 90.81%, up 35.03%. It is earned per booking from customers and per transaction from travel suppliers and payment partners [1].
Subscription revenue, mainly expense management, was $21,397K, or 9.19%, up 38.91%.
All of it is software and platform revenue; there is no hardware [1]. The plain split is booking and payment fees on one side and software subscriptions on the other.
The United States was $154,181K of Q2 revenue, or 66.23%, against 61% a year earlier [1]. The United Kingdom was $38,479K.
Volume is the driver
Gross booking volume was $3.0B in Q2 against $2.1B, up 45% as the filing gives it [1]. Payment volume was $1.3B against $1.0B, up 34%.
Revenue grew more slowly than booking volume, 35.38% against 45% [1]. In our reading, that means Navan earned a slightly smaller take on each dollar booked, which can come from mix or from pricing.
Some supplier agreements pay extra fees once booking volume passes set thresholds [1]. That makes revenue sensitive to volume at the margin.
Losses and stock pay
Gross margin was 74.09% in Q2 against 72.72% [1]. Gross profit was $172,469K.
Operating expenses were $200,211K. Sales and marketing was $104,593K, or 44.93% of revenue, against 39.83% [1].
The Q2 loss from operations was $25,570K against $12,257K, including a $2,172K gain on a property sale.
Twelve-month operating loss was -$212.41M [1]. It includes an $81.8M one-time stock pay charge at the October 2025 IPO and $36.2M of accelerated amortization from retiring the R&M brand, both in the 10-K [1][2].
Twelve-month stock pay on the cash flow line was $225.35M, or 27.29% of revenue [1][2]. Six-month stock pay was $79,169K against $35,909K, more than double, and the six-month periods exclude the IPO charge [1].
The toll-gate test
A toll gate owns the record, owns the connection, prices on outcomes and spends R&D on the gate. Navan scores well on pricing.
Usage fees are paid per booking or transaction, so revenue rises with customer travel [1]. That is the closest of any test to outcome pricing.
Navan holds the trip, the card charge and the expense line in one system [1]. Our reading is that this joined record is harder to replace than a booking tool alone.
Superintelligence agents could book travel directly with airlines and hotels. Our reading is that Navan's defense is the policy, payment and expense record around the booking, not the booking itself.
The owner-cash staircase
Start with GAAP EBITDA of -$152.75M: operating income of -$212.41M plus D&A of $59.66M over the twelve months [1]. Each step down the staircase removes one thing an owner cannot spend.
Step one is operating cash flow of $47.27M, above EBITDA by $200.02M. Operating cash ran far above EBITDA because stock pay, which is not cash, drives most of the loss [1].
Step two subtracts stock pay of $225.35M, taken from the cash flow line. That leaves -$178.07M.
Subtracting stock pay as a real cost turns the cash flow negative. This is the single biggest gap between how Navan looks on cash and on owner cash [1].
Step three subtracts all capex of $21.60M, including capitalized software. Owner cash is -$199.67M, or -24.18% of revenue.
Capex is mainly capitalized software development, $10,059K in six months, plus a small amount of equipment [1].
| Step | Twelve months | What the gap is |
|---|---|---|
| GAAP EBITDA | -$152.75M | Operating income plus D&A |
| Operating cash flow | $47.27M | Working capital, cash taxes, interest and non-cash items |
| After stock pay | -$178.07M | Stock pay treated as a real cost |
| After all capex | -$199.67M | What an owner could take out |
Balance sheet and debt
Debt principal was $125,041K at Jul 31, 2026 [1]. It is $118,174K on the warehouse credit facility, $6,000K on the ABL facility and $867K of notes payable.
The warehouse facility funds Navan's corporate card. It is held by a subsidiary, Liquid Labs, secured by card receivables, has capacity of $250.0M and runs through Feb 18, 2028 [1].
Its lenders have no recourse to Navan beyond Liquid Labs' assets.
The ABL facility has a $100.0M limit at SOFR plus 2.5%, matures in March 2028 and restricts buybacks and dividends [1].
Cash and equivalents were $653,015K, with $167,029K of short-term investments and $89,840K of current restricted cash [1]. Corporate card receivables were $212,935K.
The cover page shows 245,330,797 Class A and 15,079,696 Class B shares at Sep 3, 2026, a total of 260,410,493 [1]. The filing notes that voting power is concentrated with co-founders Ariel Cohen and Ilan Twig [1].
What the multiple measures
EV is $6.52B: equity value at the Oct 27, 2026 close on 260.41M cover-page shares, plus debt of $125.04M at carrying value, less cash and equivalents of $653.01M.
GAAP EBITDA is -$152.75M, so EV / EBITDA carries no signal. On operating cash flow of $47.27M it is 138.00x.
Owner cash is -$199.67M, so there is no owner-cash yield to quote.
Cash exceeds debt by $527.97M, so the balance sheet adds no leverage to the multiple. Most of the debt is the warehouse facility, which is secured by card receivables held in Liquid Labs.
What gets overlooked
Six-month operating cash flow was $18,388K against $4,784K [1]. Cash paid for interest fell to $4,781K from $14,337K.
In our reading, lower borrowing explains part of the gain.
Option exercises brought in $77,706K in six months [1]. That cash adds to the balance sheet but also adds shares.
Contract acquisition costs, mainly sales commissions, rose by $22,136K in six months [1]. In our reading, that shows how much sales spending is being capitalized ahead of revenue.
Peers
The peer set is Freshworks, Docusign and Intapp: workflow software sold to businesses on recurring or usage terms.
Peer figures come from each company's latest periodic filing [3][4][5]. Figures are derived from filed statements, and nothing here is a price view.
Navan grows fastest of the four, and its stock pay share of revenue is the highest [1][3][4][5]. Its EV / operating cash flow is far above the rest because its operating cash flow is small.
Bull, base and bear
| Case | What happens | What the filings would show |
|---|---|---|
| Bull | Bookings keep growing over 40% and stock pay falls as a share of revenue | Operating loss near break-even and stock pay below 15% of revenue |
| Base | Growth slows toward 30% with steady losses | Gross booking volume growth near revenue growth |
| Bear | Business travel slows and sales spending stays high | Growth below 25% and sales and marketing above 45% of revenue |
The base case is the current shape: fast growth, a gross margin in the mid-seventies and losses narrowing slowly [1].
The bull case needs operating leverage. Sales and marketing rose to 44.93% of revenue in Q2, so it has not shown up yet [1].
The bear case is a slowdown in business travel. Usage revenue would fall with it, because 90.81% of revenue is volume-based [1].
What to watch
Watch gross booking volume against revenue, 45% against 35.38% in Q2 [1].
Watch stock pay. Six-month stock pay was $79,169K [1].
Watch sales and marketing as a share of revenue, 44.93% in Q2 [1].
Watch warehouse facility use against the $250.0M capacity as the card business grows [1].
Watch the Class B share count, 15,079,696 on the cover, which sets founder voting control [1].
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