On Wednesday, Navan (NASDAQ:NAVN) discussed second-quarter financial results during its earnings call. The full transcript is provided below.
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Summary
Navan reported a strong Q2 2027 with total GBV growing by 45% year-over-year to over $3 billion, exceeding revenue and non-GAAP operating income expectations.
The company raised its full-year outlook due to strong platform usage and growth, with a projected 32% year-over-year revenue growth.
Navan's AI platform, including products like Ava and Navan Edge, is central to its strategy, enhancing efficiency and customer satisfaction.
New sales initiatives, both in enterprise (SLG) and self-serve (PLG) segments, are performing well with SLG signing $4 billion in new GBV over the last 12 months.
Navan's acquisition of Boompop aims to expand capabilities in meetings and events, contributing to strategic growth and providing a comprehensive solution for business travel needs.
The company sees significant potential in further AI integration, aiming for structural gross margin expansion and greater operating leverage.
Free cash flow improved to $28 million on a trailing 12-month basis, with a strong balance sheet of $820 million in cash and short-term investments.
Navan is optimistic about ongoing enterprise customer acquisition and sees the consolidation in the market as a growth opportunity.
The company is focused on long-term strategic investments, including potential M&A, to accelerate its vision of becoming the leading travel agency.
Full Transcript
OPERATOR
Good day, and thank you for standing by. Welcome to Navan's second quarter fiscal 2027 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question-and-answer session. To ask a question during the session, you'll need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again.
Please be advised that today's conference is being recorded. I would now like to turn the call over to your speaker for today, Aaron, VP of Investor Relations. Please go ahead.
Aaron, VP of Investor Relations
Thanks, Lisa. Good afternoon, everyone, and welcome to Navan's second quarter fiscal 2027 earnings conference call. With me on the call today are Ariel Cohen, our Chief Executive Officer and Co‑Founder, Aurélien Nolf, our CFO, and Michael Sindicich, our President. As a reminder, we publish detailed prepared remarks on our IR website. During the course of today's call, we may make forward‑looking statements within the meaning of the federal securities laws.
These forward‑looking statements are subject to risks and uncertainties that could cause actual results to differ materially, including the risks and uncertainties described in our earnings press release, our annual report on Form 10‑K filed with the SEC on April 2, 2026, and our other filings with the SEC. In addition, on today's call we refer to non‑GAAP gross margin, non‑GAAP operating margin, non‑GAAP income and loss from operations, and free cash flow, which are non‑GAAP financial measures that provide useful information for investors.
Reconciliations of these non‑GAAP financial measures to their corresponding GAAP financial measures, to the extent reasonably available, can be found in our earnings press release. And with that, it's my pleasure to turn the call over to Navan's CEO and Co‑Founder, Ariel Cohen.
Ariel Cohen, Chief Executive Officer and Co‑Founder
Thank you, Aaron, and thank you, everyone, for joining us. I hope you had the chance to review our prepared remarks. In this quarter you can have only one conclusion about us: we are winning. You can see it with the following: the current usage of the platform and its growth, our new sales, and growth of our end‑to‑end AI platform from business travel, payments and expense, VIP travel, and now meetings and events, and our AI platform leadership. We are simply executing across the board while gaining momentum. Let's talk about the current usage of the platform this quarter. Total GBV—this is travel bookings on the platform—grew by 45% year over year to more than 3 billion. We exceeded our expectations for both revenue and non‑GAAP operating income, and we are raising our full‑year outlook again. Customer satisfaction remains high, with CSAT of 96 and NPS of 44. Our platform is gaining usage across the board, on every use case, in every geo.
Let's talk about sales and new customers, and us taking share. We are seeing strong sales execution across SLG—SLG is our sales‑led growth, which is basically enterprise sales—and PLG, which is our product‑led growth, which is our self‑serve sales cycle. Our enterprise sales motion delivered another strong quarter, with SLG having the strongest sales quarter ever. New signed GBV for SLG was $4 billion in the last 12 months, and that was up 60% compared to Q2 last year.
Product‑led growth revenue more than doubled year over year again, and comes as an addition to our new sales in SLG. Payment volumes reached 1.3 billion and grew 34%, and subscription revenue was 21 million with a growth of 39%. To be clear, our growth is not coming from one isolated part of the company. The entire system is working together: sales, product, deployments, operations, customer success, and our global travel and fintech infrastructure.
At the same time, our own execution is creating more opportunity. The volume of RFPs to Navan has tripled in the first half of the year compared to the first half of last year. We now serve 50 companies in the S&P 500, up from 45 last quarter. We are winning larger and more complex enterprise customers across the globe, and the most important thing is that our investment in our sales and marketing is becoming more and more efficient with the help of AI in this huge market.
AI obviously is an important part of our strategy, so let me cover that. As I've explained in our last call, before we even get to AI, it is important to understand the foundation we have built. Navan is connected to virtually every airline, hotel room, rail provider, and ground transportation solution that our global customer needs. Business travel and fintech connectivity are extremely complex, and we have spent the last 11 years bringing that complexity together on a single real‑time global platform.
This is not just about booking a trip; it's about managing the entire journey, finding the right inventory, booking it, paying for it through a physical or a virtual Navan card, supporting the traveler, changing their itinerary when needed, and ensuring the proper credit, refunds, reconciliation are handled automatically. To do that at a global scale you need supplier relationships and negotiated rates, banking partnerships and credit lines, local entities and licenses, compliance with local law and taxes, payments infrastructure, and operational expertise in markets around the world.
We have built all of this into Navan's real‑time infrastructure. That foundation is extremely difficult to replicate, and it is what we believe allows us to turn our AI platform into a scalable solution supporting big enterprises across the globe. We are not treating AI as a feature layered onto a traditional travel product. We are rebuilding the travel and expense experience around intelligence, orchestration, and action. Navan Cognition is the intelligence layer that orchestrates specialized AI agents, human experts, data, live inventory, policy, payments, and fulfillment.
The important distinction is that Navan does not just provide an answer; it can understand intent, take action, complete the transaction, manage the trip, reconcile the expense, and bring in a human expert—with the full context—when judgment is required. Ava is our AI customer support agent who is already demonstrating the value of this architecture. In Q2, Ava handled approximately 60% of customer interactions, and our customers love it. To be clear, Ava is not doing simple things like resetting your password.
She's rebooking your trip when you are stranded in an airport, changing your hotel when you are not happy, taking care of your refunds, and many more complex business travel support tasks. The perfect orchestration between human and AI agents improves the traveler and our corporate customers' experience by supporting them more accurately and faster. Since servicing business travel and payments requires massive travel agency and operations support, it is very hard to scale fast.
By utilizing our AI platform, we are able to support Navan usage growth without jeopardizing the quality of our service. This is one of the reasons that we are so confident to raise our guidance for the second time this year to 32% year over year. We are also taking increasing control of our technology stack. Approximately 50% of our Ava AI models now run on Navan‑owned models, up from 30% in Q1. These models are purpose‑built for travel and expense and trained on our own data over time.
We believe that should give us greater accuracy, faster response time, and lower cost. So AI is not just a product investment. We believe it is also an opportunity for structural gross margin expansion and greater operating leverage. By bringing Navan capabilities directly where travel intent begins, Navan MCP extends our Navan Anywhere strategy. It provides conversational access to data across travel, expense, booking, and policy in ChatGPT, Claude, and Cursor, and separately we are adding agent capabilities in key collaboration tools like Gemini and Slack.
Navan Edge is our flagship AI product. Edge is a full travel assistant who deeply understands you like a real person. It not only plans your trip, but also books everything from flights, hotels, restaurants, and events, and makes the changes when needed. Simply, it's the best travel agent in the world. To summarize, our AI platform, travel and fintech infrastructure are the key. Ava, Navan Anywhere, and Edge are creating the application layer value, and using our own models gives us a unique value proposition based on our own data.
These three components allow us to grow our revenue faster with better economics while creating massive value for our customers. The last thing that I wanted to talk about is M&A and the expansion of our platform. As we have explained in the past, business travel has endless needs, and our goal is to bring every need into our AI platform. Travel is still an entry point but is increasingly connected to payments, expense, meetings and events, VIP travel, and bleisure.
Each of these additional products allows us to manage more of the customer spend, replace more fragmented workflows, and become more strategic inside the enterprise. That is the flywheel. We are building: better inventory and connectivity drive better experiences; better experiences drive adoption; and broader adoption creates more opportunities across the platform. This is why we build new products and make acquisitions, and why I'm so excited about our acquisition of Boompop.
This expands our capabilities in meetings and events, an enormous category that remains largely unmanaged and messy. Together with Boompop, we expect these opportunities to make Navan more valuable to our existing customers and expand the universe of customers we can serve. Boompop is already a partner. Our joint AI platforms allow us to plan events using conversational AI and in an efficient way that was never seen before. I'm super excited to welcome the Boompop team to the Navan family.
So stepping back, this quarter gives us evidence across every layer of our business. We are growing in a resilient market, we are winning larger customers and taking share—SLG, PLG—our scaling; customers love the product; AI is improving the experience, increasing efficiency, and creating a margin advantage; and we are raising our full‑year outlook because our execution is strong, our visibility is improving, and the opportunity ahead is large. I want to close this by thanking the Navan team, our customers, and investors. The team is firing on all cylinders and we are having a great time while winning. We are still in the early innings of a large opportunity, and we are building the best travel agency on the planet for the agentic era, and we are only just getting started. And with that, I'll turn it over to Aurélien.
Aurélien Nolf, Chief Financial Officer
Many thanks, Aria, it's great to be here, and thanks all for joining us today. What continues to impress me is how consistently the team is executing across the business, and Q2 was another strong example of that. I will just cover the broad momentum, so let me focus on the financial takeaways, which is growth and operating leverage are advancing. Together, revenue was $233 million, up 35% year over year, and GBV reached just over $3 billion, up 45% year over year.
Once again we exceeded our expectations for both revenue and non‑GAAP operating income. This outperformance was driven primarily by strong volume demand and bookings on the platform, with healthy expansion from existing customers, continued growth from ramping customers, and faster contribution from new launches. We also benefited from a higher premium cabin mix. Our visibility into future growth continues to improve. Over the last 12 months we signed $4 billion of new GBV in our SLG business, a leading indicator of future revenue growth.
While ramp‑up timing varies by customer, meaning it does not translate to a specific growth rate for GBV in any specific period of time, we believe this metric reinforces our expanding footprint in the sector driven by our accelerating go‑to‑market momentum. We are also seeing continued leverage in the platform. Non‑GAAP gross margin was 75% and non‑GAAP operating margin was 7%, up from 5% a year ago. Revenue continued to grow faster than our cost base even as we invested in AI infrastructure and product innovation.
The primary driver of that is AVA’s higher resolution rate, which is further supported by the increasing use of our own models that are helping us scale more efficiently, and we expect further leverage over time. Free cash flow was $28 million on a trailing 12‑month basis compared with a burn of $33 million a year ago. We ended the quarter with $820 million in cash and short‑term investments and approximately $125 million of debt. That gives us substantial flexibility to invest in the business and pursue strategic opportunities, but we will continue to deploy capital with discipline.
Now turning to the outlook for Q3, we expect revenue of $253 to $255 million, representing 30% growth at the midpoint, and non‑GAAP operating income of $35.5 to $36.5 million, representing a 14% margin. Now for the full year, and considering the sustained momentum in the business and healthy demand for business travel, we are again raising revenue guidance to $927 to $933 million, or 32% growth at the midpoint. We are also raising non‑GAAP operating income guidance to $82 to $86 million, or a 9% margin.
So now, stepping back, we believe Q2 reinforces this financial story: strong and broad‑based growth, continued operating leverage, and disciplined investment. We are entering the second half with very strong momentum, very good visibility, and a very strong balance sheet. We will remain focused on converting that opportunity into durable growth and cash generation over time. I'm very, very thankful for all the great and hard work happening across the company.
And as Ariel mentioned, we are having a great time here furthering our mission of building the best travel agency on the planet. And with that, operator, we are ready for questions.
OPERATOR
Thank you. As a reminder, if you would like to ask a question, please press star 11 on your telephone. You will then hear the automated message that your hand is raised. We also ask that you limit yourself to one question and one follow‑up, as well as wait for your name and company to be announced before proceeding with your question. One moment while we compile the Q&A roster. The first question of the day will be coming from the line of Chris Quintero of Morgan Stanley.
Please go ahead.
Chris Quintero, Analyst at Morgan Stanley
Hey, Ariel. Hey, Aurelien. Thank you for taking the questions and congrats on a great quarter here. Maybe first, you all have been seeing a lot of momentum, with that RFP activity up 200% year over year for the past few months and quarters. So curious on the win‑rate side, how that's been progressing and how that's translating in terms of timing to revenue and closing those deals.
Michael Sindicich, President
Yeah, great question. This is Michael Sindicich here. Good to hear from you again. So I think in general, first of all, we're absolutely pumped, and I'm so, so proud of the go‑to‑market team and everyone at Navan who's building the products and services that we're delivering. To your point, there's a lot of tailwinds that we're seeing. It's RFP volume increasing, it's industry stuff, it's the products that we deliver that drive 15% savings on average and you can book within seven minutes.
And everyone is super hyper‑focused on employee efficiency, especially from the people that are generating revenues for their company, which happen to be a lot of travelers. So I think with all of these tailwinds, all of the increases in the RFPs, which just gives us more at‑bats, I think it's really just simply signaling to us that we're watching disruption happen in front of our eyes. We get a lot more at‑bats and we get a lot more opportunities.
To your point, and what we've talked about in the past, is we actually see win rates increasing, we see ASPs, or average pricing, also increasing, and we see the productivity per rep also increasing. So with those three things happening, that then translates to faster growth, which we show with bookings and revenue volume. And for the first time we're super happy to report on the new sales, which was $4 billion of travel volume coming from the SLG team.
And so what that means is we then sell a deal, and then we've talked about this before, where it takes about two months on average to implement the customer. So what happens then is we connect to the HR system, your SSO, the expense solution, payments, then we set up the policy, and we launch to the company. Once we launch to the company, then it's about a five‑month on‑average ramp until the account gets to full ramp and full adoption. And that could mean deploying country by country.
It could be big‑bang launches. But on average it's about a two‑month implementation and a five‑month ramp‑up of the customer. And so that kind of gives you a hint and an idea of what it takes to close the deal all the way to ramp. And if you think about it, the companies that are doing RFPs are generally enterprise‑type companies, so larger, and those deal cycles can be a little bit longer as well. So we get an RFP, it might be six to nine months before we have a signed contract and then go and begin the implementation.
Chris Quintero, Analyst at Morgan Stanley
Got it. Very helpful, Michael. And then maybe as a follow‑up, really great to see the subscription and payments revenue acceleration here. So maybe could you unpack some of the key drivers there? I know you all have been focused on getting your sales team out and selling more of the payments and expense management solution. But just curious, kind of some of the details there.
Michael Sindicich, President
Yeah, totally. It's consistent again with what we talked about a couple quarters ago. But we were in an environment where we were relatively capital constrained, and so what that meant is we weren't as focused on selling the payments volume, which often actually comes with the expense ACV product as well. And so what we've done throughout the IPO is we've restructured our capital structure. We have brought on warehouses, we have the capacity, and now the sales team is going out there and really selling our payments and expense product, which you can see just how fast that acceleration has occurred just in a few quarters.
And we're really excited to get these products out there because customers absolutely love it. And ultimately what it does is it drives automated expense management, and the finance teams don't have to spend a lot of time reconciling their travel bookings. But I don't know, Aurelien, if you have anything to add.
Aurélien Nolf, Chief Financial Officer
Yeah, I'm super excited to see the acceleration here. Right. In terms of the growth of the payment volume, it's coming across the board. So we have more new customers signing up for payment and expense. We are seeing more upsells, and then we are seeing the existing base adopting our solution even more. And so that's why you're seeing this growth in terms of payment volume, an acceleration to 34% versus 29% last quarter. And we're very excited about these products, as Michael mentioned.
Chris Quintero, Analyst at Morgan Stanley
Excellent. Thank you both.
OPERATOR
Thank you. One moment for the next question, please. Our next question is coming from the line of Patrick Walravens of Citizens. Please go ahead.
Patrick Walravens, Analyst at Citizens
Oh, great. Thank you. And congratulations, you guys, on all the momentum. So, Ariel, why do you like the meeting off‑site space? Who is your competition there, who you're going to disrupt, and how will—I mean, everyone on this call, we all go to so many conferences and we all host so many conferences—how is our experience going to be different once you get Boompop integrated?
Ariel Cohen, Chief Executive Officer and Co‑Founder
Yeah, good question. Thank you, Pat. So here's the thing. I always thought about Navan as we first land a customer and a business traveler, right? So we tell them there is a new way to think about stuff. It is way more automated, AI is part of it, it's easy to book on the Navan platform, it takes seven minutes to book. When you want to change something, it's super fast. So, so really, really surrounding you, the traveler, around this goodness. But we also know that business travel has many more needs.
We've talked about payments and expense in the past. We talked about VIP—how can we take the VIP experience and bringing it and making an AI experience. Meeting and events is a big part. It's actually 30% of the time of this market. It's a big time of the need, of the need of the company, of the need of the traveler. And when we looked into this years ago, when we came to the market, we saw that it is so antiquated. You are basically having an RFP per event.
You are sending an EA to source some hotels and restaurants and other things. It's really, really old school. It takes a lot of time. It's extremely not transparent. You are signing with somebody a deal that they go and kind of negotiate with three hotels for you and then they tell you this is the hotel that you're going to use. Takes a lot of time. Antiquated, the opposite of what Navan is all about. So we thought if we can bring that experience to become online, to become conversational—hey, I want to have an event for my sales team.
I'm thinking about Vegas or New York, and this is my budget and this is what I need, and I'm talking with you or with the platform—and then the platform is actually automatically going and talking with the various providers, and we are creating this match. It will make the experience completely different, people will like it. And then we, as Navan, we're going to create more value to our customers. We are basically becoming more and more their one‑stop shop for every need around business travel.
So that's why we are excited about it, and Boompop specifically. We know these guys for quite some time. They are the guys, they really, really innovated in this space. They proved that you can take something that is extremely manual and make it AI. Which, by the way, two years ago when I first met them, I actually didn't believe them and I went very, very deep and understand that it's really AI and not some story, as a lot of people are telling, and it's just amazing.
But we partnered with them, we are seeing happy customers together, and we decided to make them part of Navan.
Michael Sindicich, President
Maybe I'll add to your point about how—I was going to add how prevalent it is. People are saying that it's roughly 30% of all business travel volume is actually coming from meetings and events. So the opportunity is obviously huge.
Patrick Walravens, Analyst at Citizens
Thank you both.
OPERATOR
Thank you. One moment for the next question. Our next question is coming from the line of Samad Sama of Jefferies. Please go ahead.
Michael Sindicich, President
Yeah, so I'll answer the first question about the pipelines. The RFP kind of thing that Ariel mentioned is the leading indicator. Right. So generally larger companies are more prone to launch requests for a proposal. And so obviously there's quite a lot of people that are interested in looking at Navan and I think the choices are relatively limited. It's essentially antiquated version or it's the modern AI-based travel and expense platform which is Navan.
And so that kind of gives you an idea of the pipeline. When it comes to the specific bookings and enterprise or anything like that, we actually don't separate the two or we haven't announced kind of the difference between them. But in general, you know, I'll let Aurelien talk about how bookings are trending.
Aurélien Nolf, Chief Financial Officer
Yeah, very, very healthy demand across the board, inclusive of the enterprise segment, obviously. Like we see companies keep leaning into, you know, business travel to generate revenue. Right. Like when you think about the reason why people in the first place are using our platform is because, you know, they need to meet the prospect, they need to meet customers, they need their teams to get together. And we keep seeing more travelers traveling more and the average booking going up.
So we see very, very healthy level of demand across the board. Yeah, yeah, absolutely. Great question. So you may remember when we discussed about Q1, we obviously mentioned that we saw in the back half of the first quarter some more inflation than at the beginning of the quarter, obviously due to the disruptions that are happening in the world. And our assumption for the Q2 guidance was that the exit level is what we would see throughout the second quarter. And that's exactly what happened. So from that standpoint, I think steady inflation is what we've seen throughout Q2 and this is also what we are assuming for the rest of the year.
You know, it's obviously very hard to sit here today and predict inflation. But based on everything we are hearing, all the commentaries across the industry, what we are seeing today, we believe it's a reasonable assumption. So that's how we are thinking about our guidance. What I would add to that is obviously we are not providing a bookings guidance. We are guiding to our revenue number. And as a reminder, most of the inflation is impacting flights as opposed to hotels.
And the way we monetize flights versus hotels is such that the impact of inflation on revenue is way less than the impact on bookings. So I just wanted to also reiterate that.
OPERATOR
Thank you. One moment for the next question, please. Our next question is coming from the line of Noah Narpers of Goldman Sachs. Your line is open.
Noah Narpers, Analyst at Goldman Sachs
Hey everyone, thanks for taking the question. Maybe one more on BoomPop. I think you cited in the deck a 30% savings rate which just seems very impressive relative to the 15% you talk about for the rest of the business, which is already great. So just wondering where that comes from.
Michael Sindicich, President
Yeah, I don't, I won't know all the specifics of each type of savings there, but I can talk generally about it. So what BoomPop does is, first of all, it's, as Ariel mentioned, it's fully AI conversational-based. And what they'll do is you can explain what you want to do and then they will actually go out and source various hotels, they will source catering, they'll source photographers, if you want to buy sweatshirts, they'll create a website for you, they'll manage your attendees.
It's a very, very robust program that kind of puts together in one solution this spaghetti type of operation of doing an event. And then what happens is BoomPop has really deep relationships with suppliers and what they do is they can bring them volume and you can get better rates than what you would see just on the normal hotel's website. And so, you know, again, not knowing exactly each specific of how it adds up. But the bulk of the savings is going to come from the discounts from the list pricing.
If you were to go and do it yourself and just sign up with a hotel and book those rooms because they're able to pass on the negotiated rates that they can get to the customer, does that make sense?
Noah Narpers, Analyst at Goldman Sachs
It does. And I guess if you think about sort of your algorithm and the way you capture value through pricing, would you expect meetings and events to kind of continue to be a higher yielding segment for you and this sort of amplifies that or would you think of it long term as in line with the rest of the business, you know, here.
Aurélien Nolf, Chief Financial Officer
So we are usually not breaking down yield by line of business or different components of the business. But what I can tell you is it's roughly steady and very consistent with what we are seeing. But what's really more important than that is combining the two companies gives us a huge opportunity. We have a great portfolio of customers that are all organizing meeting and events and most of them doing that offline. And combining forces with the BoomPop team and their cutting-edge technology gives us the ability to upsell and really attach meeting and events, this business, to more and more of our customers.
So when I think about the value we are providing here, as Ariel mentioned, going deeper in our relationship with our customers through that new business of meeting and events, which we were already doing as a company, but we are now bringing it online with BoomPop.
Noah Narpers, Analyst at Goldman Sachs
Great, thanks.
Aurélien Nolf, Chief Financial Officer
Thank you.
OPERATOR
Thank you. One moment please for the next question. Our next question is coming from the line of Steve Enders of Citi. Please go ahead.
Steve Enders, Analyst at Citi
Okay, great. Thanks for taking the questions. I guess to start, I want to ask about the direct connect relationship with Hilton on the hoteling side. I guess to get your perspective on what this new relationship means and maybe how it augments the hoteling side of the business and industry moving forward.
Michael Sindicich, President
Yeah, in general, the way that we approach our platform is to try to drive the best and the most content out there. And so that means connecting to multiple GDSs like traditional agencies. It means building and being at the forefront of all the NDC connections that we can do with the airlines. It means adding low-cost carriers like your Ryanairs, EasyJets and your Southwest. And so the idea is basically we want travelers to be able to access all the best content, all the best rates and the best inventory that's suitable for them.
One thing that we launched is the engine partnership as well, which is huge for us to add more content and more availability and better types of bookings for different industries. But on top of that, to your point, one of the things that we did is launched a direct connection to Hilton. And what we're doing by connecting directly to suppliers is it allows them for more flexibility, more accurate retailing, better upselling of ancillaries that are relevant to travelers.
And it allows us to service these types of bookings really quickly, apply unused credits automatically and just manage cancel/change these types of bookings. So for us, it's not a play about, you know, driving a different yield or a different revenue from these types of things. It's about giving the right content, the best content, the best pricing to our travelers on the platform.
Steve Enders, Analyst at Citi
Okay, perfect. That's great to hear. And then maybe to follow up just on the margin dynamics in the quarter, I guess, anything on, you know, I mean, the revenue, I think upside was pretty strong, but I guess trying to understand, you know, that didn't really flow through to the bottom line. So, you know, trying to understand, you know, the moving pieces in that and maybe you know, how you're thinking about those incremental investments and what you're assuming in the guide for the rest of the year as well.
Aurélien Nolf, Chief Financial Officer
Yeah, of course, maybe I can unpack that a little bit. So first of all, as you mentioned, very strong revenue beat and driven by a lot of bookings, great sustained momentum and demand. So yeah, great beat on revenue. Our gross profit was more than 75% for the first time in the company history. So, you know, very, very. We keep seeing a lot of tailwinds here coming from the rate of resolution that Ava, he's handling at 60% of our Q2. And that makes us way more effective from a cost perspective on top of obviously providing a better service for travelers, but obviously very, very good from a gross margin perspective. And then because we've been so successful in our go to market initiative and with more than $4 billion new signed GBV for SLG, we're just paying more commissions. Right. And again, very, very happy about the payback here.
And what we are seeing, we have a very, very strong and efficient go to market team. And so that led us to also beat our bottom line expectations as well.
Steve Enders, Analyst at Citi
Okay, perfect. Thanks for taking the questions.
OPERATOR
Thank you. One moment please for the next question. Next question is coming from Jed Kelly of Oppenheimer and Company. Please go ahead.
Jed Kelly, Analyst at Oppenheimer
Great. Thanks for taking my question. Just looking at the pace of your gross margin expansion in 2Q, sort of moderated from what we were seeing the last couple of quarters. Is there anything in there to call out or is it just tougher comps?
Aurélien Nolf, Chief Financial Officer
Yeah, we extended gross margin 200 basis points in the year over year in Q2 and as a reminder, we expanded gross margin by 1,000 basis points over the last couple of years. So I mean, we keep making a lot of progress there. And you know, we are launching more customers and be very, very thoughtful about deploying, you know, human agents orchestrated with our AI agents. And we're very pleased. Like I'm very excited to see the rate of resolution from AVA going to 60%.
And the team has a lot of ambition here to keep driving that mix at an even higher point, specifically as we use more and more of our own models that are more accurate, give better results and faster results. And so as we keep making progress here, we're going to keep AVA handling more and more of our support function and margins are going to keep expanding. But I'm very excited about the pace of the expansion because what's the secret sauce of Navan?
And the reason why our customers love us is we are not optimizing for gross margin. We are optimizing for NPS and CSAT. And as a result of that, we are seeing a gross margin expansion. But first and foremost, the reason why we are successful is because we are the best travel agency on the planet. And that's what comes across when you look at our satisfaction scores.
Jed Kelly, Analyst at Oppenheimer
Great. And then just as a follow up, congrats again on the NDC with Hilton. Just can you talk about, can you discuss other conversations you're having with chains on sort of direct connections. And I know you just mentioned it's not about yield management, but wouldn't this improve your yield by relying less on indirect supplier agreements? Thanks.
Ariel Cohen, Chief Executive Officer and Co‑Founder
Yeah, that's a really good question. I think when we think about what we call internally content, it's all about all of these advantages that I was talking about when it comes to AI, because there are so many ways to connect to suppliers, to airlines, hotels, and others. You can use a lot of aggregators, but that means that you are not always assuring the right price for the customer. But also from a merchandising perspective, you don't have the right information.
So it could be the pictures of the room, it could be the size of it. The description—same goes, by the way, for airlines. So when you go to the Navan platform, no matter if we show it in the UI or in a conversation in a platform like Navan Edge, it's all about really, really, really knowing what's out there, what you, the user, want, and creating the match between that. So if the people on this call have used Navan Edge—obviously it's a new product—you can see that I can actually tell Navan Edge what kind of hotel, what kind of room I will want to have in my next stay in New York, and it will tell me, you know, because you like the bar and you like the gym, we suggest that you be in this hotel. But I didn't even ask about the gym or the bar. Right. Or I didn't look for the logo of the gym and the bar. So Navan Edge really knows me. That's really important. But it is thirsty for content. It really needs all of this information, like you think about merchandising. So by connecting directly to suppliers, by going to aggregators, by taking all of this data, which is, by the way, Navan data, now we can actually create an amazing experience which, by the way, creates more revenue.
Because you are more likely to book in the Navan platform, you are less likely to go and look for it outside because we are just giving you the better information. So this is really what lays behind the NDC strategy. Although sometimes benefits of yield to us or benefits of pricing to the customer—the answer is yes—but that's not what drives this strategy. What drives this strategy is data and the data that we are presenting to our customers.
OPERATOR
Thank you. One moment, please. Our next question is coming from the line of Jared Levine of TD Cowen. Please go ahead.
Jared Levine, Analyst at TD Cowen
Thank you. To start, I was hoping you could give an update in terms of your sales headcount investments. I guess where is capacity growth at currently at this point in the year and what are you targeting for the rest of the year?
Aurélien Nolf, Chief Financial Officer
This is Aurélien. So you're seeing our marketing and sales investment, which is mostly sales investment, growing at roughly the same pace Q-on-Q. So I would not expect any significant changes this year from that standpoint. What will fluctuate every quarter is always the amount of commissions we are paying to our sales team depending on how successful they've been. And as you've seen, they've been very, very successful. Recently Michael has been discussing about the great pipeline for the rest of the year, and so we would be very pleased to keep investing in our marketing and sales engine for the balance of the year.
And then beyond that, if we step back from our P&L, the opportunity is massive. Right. And so when the management team has conversations about where do we want to invest, where is the opportunity, it's very, very clear to us that the size of the corporate travel market is so significant and we are such at the beginning of the penetration of that market. We're very proud of serving 50 companies out of the S&P 500. But that means many of them are up for grabs and that's the opportunity, and that's why we will keep investing in our marketing and sales engine going forward.
Jared Levine, Analyst at TD Cowen
Got it. And then my follow-up, can you dig into between Smartrips and BoomPop, those two acquisitions, the impact that that had to your FY27 guidance update? I guess some online resources are suggesting that BoomPop could be north of a hundred million revenue run rate, which could be pretty significant in terms of that contribution. So any kind of incremental color in terms of the impact of the guidance update would be helpful.
Aurélien Nolf, Chief Financial Officer
Yeah. So absolutely not those levels of revenue impact. So for fiscal 27, Smartrips is, top and bottom line, very immaterial. So if it's in your model, you're doing it wrong. So it's small, very strategic, and we're very excited about it because of the access this is giving us to a lot of local inventory, IATA licenses, and a great team, but immaterial impact to our financial statements in the short term. And then from a BoomPop perspective, low single-digit, very low single-digit impact to revenue in fiscal 27—so far away from the number you just quoted—and a mid-single-digit impact to the non-GAAP operating income.
As we are integrating the team, we expect that business to become accretive in fiscal 28 though, but fiscal 27, the summary is immaterial impact to top and bottom line.
Jared Levine, Analyst at TD Cowen
Got it. Thank you.
Aurélien Nolf, Chief Financial Officer
Yeah, of course.
OPERATOR
Thank you. One moment please for the next question. Next question is coming from the line of Blair Abernathy of Rosenblatt Securities. Please go ahead.
Blair Abernathy, Analyst at Rosenblatt Securities
Thanks, and great quarter guys. Just two questions, I guess. One, any update on the transitions going on with the Reed & Mackay customer base on your platform—just sort of how that's progressed this quarter? And then secondly, in terms of new customer adoption of the Navan MCP and Navan Edge, maybe just any other color around what you're seeing there in terms of the profile of customers that are utilizing these new capabilities.
Ariel Cohen, Chief Executive Officer and Co‑Founder
Sure. So first of all, regarding Reed & Mackay, we really need to understand that there are two aspects there. One is really us providing VIP service on platform for most of the Navan customers, and there it's actually fully integrated and people are super happy. As you know, we are always measuring CSAT and NPS. Then the Reed & Mackay customers, which are fairly traditional, used to mainly talk with agents—calling, sending emails. We have this idea, which I've talked about in the past, to bring them on platform, and it's a program that will take several years, and right now we are very happy with what we see.
We see more and more customers of that nature actually going to this platform and, by that, really enjoying this orchestration that I'm talking about—AI agents and actually VIP agents in this case together providing them service. And the reason that we know that they are happy: when they are doing this transition, their NPS and CSAT tends to be really high. So that's what we see and that's why we are continuing with this program. So this is really how I'm looking at this program and asking myself, is that successful or not?
Are we seeing satisfaction by these very, I would say, traditional customers that want this type of service? So that's that part. Regarding the question of Edge, first of all, I would say maybe the bottom line here: Edge is the fastest growing product that we've ever launched in Navan. So that's really, really important. It actually tells us that this idea that people will want to have a conversation with AI and book their entire trip, but also having restaurants, events as part of the trip—doing all of these things automatically while we know them very, very well—that idea resonates with a new type of customer for Navan.
This is not a corporate customer that we signed with. This is actually an individual who is a business traveler that is coming to our platform and starting to book a trip. And what I'm looking at is, first of all, are we growing? And as I said, we are growing really fast. Second, I'm asking myself, is NPS high? Is CSAT high? NPS there is actually very high, significantly higher than what we see in the Navan platform. Then I'm asking myself, do I see repeating usage?
Remember this is not a company that the CFO told them you have to use Navan. This is an individual that decided to come to our platform and book. So do I see that individual coming again for their next trip? And their next trip? And the number there is actually amazing. It's way more than what I was expecting and actually the trend is going up. So all of the numbers trend is very, very positive. We are very happy with what we see there, and I'm actually very optimistic as this starts to get scale to start to see impact next year on our numbers.
Blair Abernathy, Analyst at Rosenblatt Securities
Okay, great. Thank you.
OPERATOR
Thank you. One moment please. And the next question is coming from the line of Siti Panigrahi of Mizuho. Please go ahead.
Siti Panigrahi, Analyst at Mizuho
Thank you. Thanks for taking my question. In the competitive landscape, there is some consolidation we saw in the legacy vendors. I'm wondering how is the pipeline and win rate trending, and how you're trying to capture that market in general?
Michael Sindicich, President
We see the consolidation as a big tailwind for us. I think hopefully customers are seeing that we are causing quite a lot of disruption because we're completely changing what it means to manage corporate travel in the world of technology and AI. And so because of that, a leading indicator is what Ariel talked about earlier, where RFP volume has tripled since H1 of last year versus H1 of this year. And so usually those RFPs are coming from more enterprise customers, and you can assume the enterprise customers are coming from more of the legacy travel management companies that are doing some of the consolidation.
So hopefully that gives you a clear view of what we're experiencing internally.
Siti Panigrahi, Analyst at Mizuho
Great, thank you.
OPERATOR
Thank you. One moment please for the next question. Next question is coming from the line of Nafisa Gupta of Bank of America Securities. Please go ahead.
Nafisa Gupta, Analyst at Bank of America
Hi, thanks for taking my question. Little broad-based question here. So as you win larger global enterprises, would love to understand how do the long-term economics compare with some of the mid-sized, smaller customers you've had historically across product attach. Sorry, sorry, sorry.
Aurélien Nolf, Chief Financial Officer
Nafisa, you're cutting. Can you say that again?
Nafisa Gupta, Analyst at Bank of America
Can you hear me now?
Aurélien Nolf, Chief Financial Officer
Oh yeah, it's better. Thank you.
Nafisa Gupta, Analyst at Bank of America
All right, I'll just repeat. So I was asking on your larger global enterprise wins, and how do the long-term economics compare with some of the smaller customers you've had previously across metrics like product attach, retention, yield, implementation costs, and maybe expansion potential in general? How should we think about long-term trends?
Aurélien Nolf, Chief Financial Officer
Yeah, yeah. So first of all, before I compare the different cohorts or segments, just want to reiterate that it's been very steady. Right. Like we are not seeing any shift when we look at segment by segment, not seeing any shifts from pricing or yield or the way we work with different companies. What we've been discussing in the past is, generally speaking, enterprise customers have a very different profile than mid-market or smaller entities. At the end of the day the gross margins look very, very similar.
But the way we construct those gross margins is a little bit different. So enterprise customers frequently have direct negotiated rates with airlines or hotel chains and so on. For those bookings that we facilitate on our platform, we charge more trip fees as opposed to getting some commission from our suppliers. And the opposite would be true when you go down in the market. But every customer is made different. One of the reasons why we love all of them and all those segments—and with their different characteristics—is they also come with different tailwinds that they provide to the platform.
So enterprise customers are coming with very significant volumes. They are very sticky customers, and they offer a lot of opportunities for us to upsell and attach more of the expense and payment—now the M&E business as well—and provide a lot of opportunity for our sales team to just go and upsell and grow the relationship with them. And so again, different characteristics, overall similar gross margins but being constructed in a different way.
OPERATOR
Thank you. Thank you. One moment please. Next question will be coming from the line of Scott Berg of Needham and Company. Please go ahead.
Ian Blackown, Analyst at Needham & Company
Hi, this is Ian Blackown for Scott Berg. Congratulations on the acquisition of Boom Pop. What's the opportunity for more tuck‑in deals like this? And are there any areas where you think you could benefit from M&A?
Ariel Cohen, Chief Executive Officer and Co‑Founder
Yeah, I mean, obviously I don't have any specific target or acquisition in mind today that I want to talk about, but we are always looking for opportunities to expand like we just did to a new, new product that helps us upsell and attach more product to our existing relationship. So that's what you saw with Boompop SmartTrips was clearly, you know, us trying to increase, expand our footprint globally. And so, you know, we could see more of that in the future.
But I want to say the bar for M&A is very high. Right. We really look at companies that, you know, can bring things that we don't have internally or that we think would take a long time for us to build by ourselves. But it's not, it's not a goal. It's just a tool for us to accelerate our vision. Thank you.
OPERATOR
Thank you. And I would now like to turn the call back over to management. Please go ahead.
Ariel Cohen, Chief Executive Officer and Co‑Founder
Great, great. So thank you all. So just as last quarter, we have been asking our individual investors to submit some questions on our platform. And so I think, Erin, you want to share the top‑voted questions with us?
Erin, Investor Relations
Yeah, thanks, Aurelian. I've got three. The first question, I think it's for Ariel. This is from Patrick P. He asks, the company is mostly for business use. Will there be availability for individuals in the near future?
Ariel Cohen, Chief Executive Officer and Co‑Founder
Yes. So first of all, the first user that is now coming to the platform as its own decision is actually people that are coming to Navan Edge. These are employees that are working for companies. They either don't have a managed solution in the organization that they work for or they are not happy with that solution. And because of it, they are coming to Navan Edge. So in a way, while they are business travelers, they have a behavior of a consumer.
They are deciding to book their business trip in Navan now across the platform. While you are using us, you can also use us for your personal needs. We internally call it bleisure, which means that, let's say that I'm flying to New York, but I'm also spending the weekend there. I can actually combine the usage of my business need with my personal need. There is an entire functionality there that allows you to split the cost, to really kind of have the personal trip isolated from the company reporting and so on.
So these two aspects today in the Navan platform are very consumer. One, it's actually I'm deciding to use Navan Edge, and the other one, I'm extending my business trip into a personal trip, and people like to use these two products.
Erin, Investor Relations
Great, thanks so much. The next question I think is for Aurelian. If business slows down, what are your cost‑cutting strategies?
Aurélien Nolf, Chief Financial Officer
Yeah, so first of all, so far so very good. Right. I think we've been discussing this on this call. The demand for business travel is very, very strong right now. So obviously not something I'm focused on at the moment because we are very excited about the volume of bookings on the platform. You know, I think in that scenario the process will be the exact same than we have today, which is really focus on the return of investment and being very intentional.
You know, today we are clearly going on the offense because we see great payback every time we invest, be it R&D, marketing and sales, we see a very, very good payback. And I think if that were to be the case, the process would be again, exactly the same.
Erin, Investor Relations
Okay, that's really helpful, thank you. And our last question. Michael, this one's for you. This is from John Z. Navan Rewards program. How is Navan incentivizing users to earn rewards for personal stays off of bids? Why do they expire?
Michael Sindicich, President
Yeah, great question. So just to set some context, so everyone here knows Navan actually pays travelers when they choose more cost‑effective options on behalf of their company for business travel. So it's a really unique way to help drive that 15% savings that we bring to our customers. And to the question. So some airlines, hotel programs, et cetera, the points will expire. Some of them don't. A lot of them, a lot of points programs generally are rather opaque.
And the Navan platform is giving dollar for dollar. So when we give you a dollar reward, you can use it. Its value is worth a dollar for a personal travel booking. And essentially our travelers on our platform are able to triple dip. So when they make a booking, they can use their credit card and get credit card points. They can book suppliers that will give you those specific airlines and those hotel points. And then on top of that are the Navan rewards that we pay for.
And so because of that, it's the kind of program that actually expires those rewards after 12 months. So our message is just make sure you hurry up and use them if you've saved your company money to go on a personal vacation.
Erin, Investor Relations
Great, thank you. Now turning it back to the operator. Thank you all for joining us today.
OPERATOR
Thank you all for joining us today. This now concludes today's program. You may now disconnect. Goodbye.
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