Docebo Inc (DCBO) (Q3 2026) Earnings Call Highlights: Accelerating Subscription Growth, $60 ...

Q: What is the rationale behind the $60 million special dividend, and what does it mean for deleveraging and M&A capacity? A: CFO Brandon Farber said the dividend will be funded from remaining debt capacity, taking debt from $90 million to $150 million and leaving net debt of approximately $108 milliona net debt to EBITDA ratio of 1.9x. Capital allocation priorities remain consistent: invest back in the business (healthcare, FDE, government hiring) while maintaining ~20% EBITDA margins, remain opportunistic on M&A (two acquisitions in 2026) but focus on execution over the next 12 months, and return cash to shareholders. He noted $82 million was spent on buybacks in 2026, but a recent SIB saw only $2.5 million filled of a possible $70 million, making a special dividend the best use of excess capital and a signal of board confidence in the highly recurring, predictable cash flow.

Q: What is the current operational traction in the government vertical, and what is the outlook post the U.S. midterm elections? A: CEO Alessio Artufo said government was Docebo's first verticalization and the strategy is playing out, with a strong pipeline build above expectations in Q3. Significant deals expected in the quarter slipped due to complex SLED and federal procurement processes, but he has great confidence they will close this fiscal year. He emphasized the public sector strategy is diversified beyond federal, including state and local government and partners like Deloitte, and that the team is being staffed up to meet future goals.

Q: How is the launch of Knowledge expanding Docebo's reach into the broader enterprise, and how are you teeing up sales to CROs, CCOs, and the CIO office? A: CEO Alessio Artufo noted that more than 50% of customers already use Docebo for external use cases budgeted by the CRO and CCO offices, so the capability to sell beyond L&D buyers is already built in. With AI blending learning and knowledge, Docebo is now connecting to broader enterprise data sources like SharePoint, SalesSource, Confluence, Notion, and Google Drive. He expects the CIO office to become more involved and said Docebo will repeat the playbook it used when approaching new buyers years ago.

Q: What is the significance of having 600 beta customers for the new release? A: CEO Alessio Artufo explained the distinction between private and public beta, noting that public beta with 600 customers provides real practitioner feedback that closes the gap between what product and engineering teams anticipate and actual usage. He framed it as part of an engineering-first and customer-first mindset, with a monetization component: coming out of the gates prepared to welcome net new customers who have already gone deep in the product.

Q: What are you seeing competitively in the LMS refresh cycle, and is there an RFP tailwind from legacy incumbent disruption? A: CEO Alessio Artufo said Docebo focuses on itself rather than competitors, but modern complex enterprises want a platform with deep workflow, enterprise capabilities, security, governance, and certifications like FedRAMP. He sees little competition offering AI, learning, knowledge, and skills intelligence in a highly integrated platform that can withstand organizations of 30,000 to 100,000+ peoplea moat that is very hard to replicate.

Q: How is the cross-sell of the Skills Intelligence (365 Talents) platform into the existing base progressing, and how does AI content creation cross-pollinate? A: CEO Alessio Artufo said the acquisition closed earlier this year and the focus has been on integrating the products for a seamless experience, with the latest release recently shipped. Large enterprises are benefiting most from the combination, and Docebo is on track to surpass its budget expectations. On Creator, he said personalization is a key differentiator, and agents are being developed that understand learner profiles and create material in real time using Creator as the underlying enginethe first Creator agent has already shipped.

Q: Where are you on the FDE (forward-deployed engineer) investments, and what has customer interest been? A: CEO Alessio Artufo said the strategy of embedding FDEs in the largest enterprise accounts is unchanged, and the team is now fully staffed with target accounts identified. Over the next three to six months, Docebo will validate the operating model, customer engagement, monetization strategy, and the boundaries of FDE value creation on top of customer- and FDE-built agents. He noted customers are already raising their hands for help building no-code agents, and updates are expected over the next couple of quarters.

Q: What is driving gross margin pressure, and should we expect it to extend into Q4 and beyond? A: CFO Brandon Farber said subscription gross margins are essentially unchanged from historical levels; quarterly movements relate to specific professional services projects and PS growing faster than subscriptions. He expects a similar trend in Q4, but as Docebo laps a strong enterprise year in 2027, PS growth should become more consistent with subscription revenue, normalizing and allowing gross margins to tick back up.

Q: How should we think about EBITDA margin expansion into 2027 given reinvestments in healthcare and FDE? A: CFO Brandon Farber highlighted 34% EBITDA growth this quarter alongside top-line growth and said Docebo remains a disciplined capital investor. He expects R&D to stay roughly flat as a percentage of revenue into 2027, continued G&A leverage, and some EBITDA margin expansion, with full guidance coming in February.

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For the complete transcript of the earnings call, please refer to the full earnings call transcript .