Will Asana report dollar-based net retention rate (NRR) of 97% or higher for Q4 FY2026?

Overall NRR stalled at 96% for two consecutive quarters (Q2 and Q3 FY2026) despite improving fundamentals. NRR is a trailing 4-quarter metric, meaning Q4's reported number still includes Q1 FY2026 (when overall NRR was 95%) in the calculation window. For the trailing metric to reach 97%, Q4 quarter-specific retention would need to be materially above 97% to pull the average up from the 95-96% range of prior quarters. Core NRR at 97% is encouraging but the overall metric includes SMB/mid-market customers where contraction continues. The stall from Q2 to Q3 at 96% despite management claiming 'in-quarter improvement across all cohorts' suggests the trailing calculation is a significant drag.

The segment-level data provides a more optimistic signal than the overall stall suggests. Core customer NRR ($5K+) reached 97% in Q3, and $100K+ NRR improved from 95% to 96%. The $100K+ cohort is growing 15% YoY, which means its weight in the overall NRR calculation is increasing each quarter. The CFO's commentary about 'successfully renewed several large tech companies' and '$50K-$100K cohort saw exceptional strength' suggests Q4 may have had strong enterprise renewals. However, the committee flagged that NRR decomposition is unknown — we cannot distinguish customer loss from spend reduction. If SMB churn accelerated in Q4 due to the 'evolving search landscape' headwind, it could offset enterprise improvement.

Management stated the company is 'at or near the bottom' on NRR, and monthly retention hit a 12-month high. If this inflection is real, one might expect Q4 to show improvement. However, 'at or near the bottom' is consistent with NRR remaining at 96% — it means the decline has stopped, not that recovery has begun. The trailing 4-quarter calculation methodology means even if Q4 quarter-specific retention improved, the overall metric may not reach 97% because the window still captures weaker earlier quarters. Three lenses converged that NRR at 96% is 'a headwind, not a spiral' — this framing supports stabilization (staying at 96%) rather than recovery (reaching 97%).

The data is clear: overall NRR has been 96% for two straight quarters. Going from 96% to 97% in one quarter when the metric is a trailing 4-quarter average is a big ask. Core NRR is at 97% but overall is not, meaning the non-core (SMB/mid-market) segment is pulling it down significantly. Monday.com growing 27% vs Asana's 11% suggests competitive pressure is real and likely accelerating churn in overlapping mid-market segments. The Myth Meter classified the NRR crisis as DIVERGING from reality, but stabilization at 96% is very different from recovery to 97%. Probability around 30%.

Several positive signals deserve more weight than the bearish case acknowledges. Monthly customer retention at a 12-month high is a leading indicator — trailing NRR lags monthly dynamics. Core NRR hitting 97% in Q3 means the majority of revenue-weighted customers are at the threshold. The CFO's specific mention of 'exceptional strength' in the $50K-$100K cohort and successful renewals with large tech companies suggests Q4 may have been the strongest quarter for enterprise retention. RPO at $500.9M (+23% YoY) with 77-81% current provides a floor. If the enterprise improvement Q3 showed continued into Q4, the weighting effect could push overall to 97%. But the stall at 96% for two quarters is hard to dismiss.

NRR went 95% -> 96% -> 96% over three quarters. The improvement rate is decelerating — 1pp gain in Q2, then 0pp in Q3. For Q4 to report 97%, the improvement rate would need to re-accelerate. While the committee notes improving trends within the quarter, the actual reported number stalled. The trailing metric mechanics mean even an excellent Q4 quarter-specific cohort performance gets averaged with the 95-96% earlier quarters. Additionally, Asana typically reports NRR rounded to the nearest whole percentage point — so 97% means at least 96.50%. Getting from 96.XX% to 96.50% is not impossible but requires meaningful acceleration in a single quarter. Roughly 1 in 3 probability.

NRR stuck at 96% for two quarters. Core NRR at 97% but overall lagging due to SMB drag. Trailing 4-quarter metric resists quick jumps. Monday.com competitive pressure real. More likely NRR stays at 96% than jumps to 97%.

Core NRR already at 97% is the strongest bull signal — means the revenue-weighted majority of customers are at threshold. Monthly retention at 12-month high is a genuine leading indicator. But overall metric still at 96% after two quarters of these positive dynamics, suggesting SMB drag is substantial. Lean toward NO but not with high conviction given the positive segment trends.

The gap between core NRR (97%) and overall NRR (96%) shows SMB/mid-market is a material drag. Two quarters at 96% despite improving enterprise dynamics means the drag is persistent. Management says 'at or near bottom' which is consistent with 96% continuing, not 97%. Resolution at 96% most likely.