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01/11 04:05
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Access earnings results, analyst expectations, report, slides, earnings call, and transcript.
The earnings call summary reflects strong financial performance, with a 46% increase in revenue and consistent gross margins. While operating expenses are high, the increase in non-GAAP EBIT and free cash flow is encouraging. The Q&A section highlights successful cross-sell and upsell strategies, and the raised revenue guidance indicates confidence in future performance. Despite some unclear responses from management, the overall sentiment is positive, driven by robust growth metrics and strategic focus on cyber resilience.
Total ARR $996 million, a 24% increase year-over-year. This growth was driven by strong performance across the business.
Subscription ARR $844 million, a 33% increase year-over-year. This was led by a 63% increase in SaaS ARR to $307 million.
Total Revenue $282 million, a 26% increase year-over-year. This growth was supported by a 46% rise in subscription revenue.
Subscription Revenue $182 million, a 46% increase year-over-year. This was driven by strong land and expand performance and gains across regions, industries, and transaction sizes.
Gross Margins 82.4%, consistent with expectations for total gross margins to remain in the low 80% range.
Operating Expenses $173 million, representing 61% of total revenue. This included planned headcount growth, investments for growth, and higher commissions and bonuses on record sales results.
Non-GAAP EBIT $58 million, a 21% increase year-over-year. Non-GAAP EBIT margin was 20.7%.
Free Cash Flow $30 million, driven by strength in deferred revenue from SaaS contracts and solid software subscription renewals.
Cleanroom Recovery: Growth with Cleanroom Recovery offering, enabling customers to test cyber resiliency. A government institution in the Middle East adopted this along with Air Gap Protect, Active Directory, and Cloud Rewind for enhanced security.
Recovery Range: Introduced Recovery Range, a hands-on experience for security and IT teams to simulate real-world attacks and test preparedness.
Satori Cyber Acquisition: Announced intent to acquire Satori Cyber, a data and AI security company, to strengthen data security offerings and address AI-related threats.
SaaS ARR Growth: SaaS ARR grew 63% to $307 million, surpassing 8,000 customers and nearing a $330 million ARR target ahead of schedule.
Cloud Marketplaces: Achieved triple-digit growth in marketplace transactions, with multiple six-figure and seven-figure deals.
Geographic and Industry Growth: Posted healthy growth across geographies, industries, and customer segments, from enterprise to SMB.
Subscription Revenue: Increased 46% to $182 million, with subscription ARR constituting 85% of total ARR.
Customer Expansion: Acquired 700 net new subscription customers, with SaaS customers utilizing two or more products increasing by 45%.
Profitability: Non-GAAP EBIT grew 21% to $58 million, with a 20.7% EBIT margin. Free cash flow was $30 million.
Partnerships: Formed strategic alliances with Deloitte, CrowdStrike, HPE, and Kyndryl to enhance cyber resilience and recovery capabilities.
Gartner Recognition: Named a leader in the Gartner Magic Quadrant for Backup and Data Protection Platforms for the 14th consecutive time.
AI and Data Security: Focused on protecting AI data and addressing threats posed by AI abuse, with plans to integrate Satori Cyber's capabilities.
Cybersecurity Threats: The company operates in a market with relentless threats and attacks, requiring continuous innovation and preparedness to maintain resilience. This includes risks from AI agent abuse, as highlighted by Gartner's prediction of enterprise breaches by 2028.
Regulatory Compliance: The company must ensure compliance with various regulatory requirements, such as FAA and aircraft manufacturer compliance, which adds complexity and potential risks to operations.
Integration of Acquisitions: The acquisition of Satori Cyber is expected to be modestly dilutive to margins for the next several quarters, posing a short-term financial risk.
Economic and Currency Risks: The company faces risks related to foreign exchange fluctuations, as highlighted by the constant currency adjustments in their financial reporting.
Market Competition: The company operates in a highly competitive market, requiring continuous innovation and strategic partnerships to maintain its leadership position.
Operational Costs: Planned headcount growth and investments to support growth trajectory could increase operational costs, impacting profitability.
Q2 FY '26 Subscription Revenue: Expected to be in the range of $174 million to $176 million, representing 31% year-over-year growth at the midpoint.
Q2 FY '26 Total Revenue: Expected to be in the range of $272 million to $274 million, with growth of 17% at the midpoint.
Q2 FY '26 Consolidated Gross Margins: Expected to be in the range of 81% to 82%.
Q2 FY '26 Non-GAAP EBIT Margins: Expected to be approximately 20%, including the integration of Satori Cyber.
FY '26 Total ARR Growth: Expected constant currency growth of 18% year-over-year.
FY '26 Subscription ARR Growth: Expected to increase by 24% year-over-year.
FY '26 Subscription Revenue: Expected to be in the range of $753 million to $757 million, growing 28% at the midpoint.
FY '26 Total Revenue: Expected to be in the range of $1.161 billion to $1.165 billion, an increase of 17% at the midpoint.
FY '26 Gross Margins: Expected to be in the range of 81% to 82%, reflecting growth in the SaaS platform.
FY '26 Non-GAAP EBIT Margins: Expected to be approximately 20.5%, including the dilutive impact of Satori.
FY '26 Free Cash Flow: Expected to be in the range of $210 million to $215 million.
Stock Repurchase: During the quarter, we repurchased $15 million of stock and our diluted share count remained flat at 45 million shares.
The earnings call reflects strong financial performance, with significant growth in subscription revenue and ARR. Despite some concerns about competition and contract duration shifts, the company's strategic investments in SaaS and market share gains are promising. The Q&A indicates confidence in growth and resilience strategies, with positive insights on TAM growth and competitive positioning. Overall, the sentiment is positive, with potential for stock price increase driven by strong financials and optimistic guidance.
The earnings call summary reflects strong financial performance, with a 46% increase in revenue and consistent gross margins. While operating expenses are high, the increase in non-GAAP EBIT and free cash flow is encouraging. The Q&A section highlights successful cross-sell and upsell strategies, and the raised revenue guidance indicates confidence in future performance. Despite some unclear responses from management, the overall sentiment is positive, driven by robust growth metrics and strategic focus on cyber resilience.
The earnings call reflects strong financial performance, with a 23% revenue increase and robust subscription growth. Positive guidance and strategic expansion in SaaS and cyber resilience markets support the outlook. Share repurchases exceeding guidance enhance shareholder value. Despite competitive pressures and macroeconomic concerns, management's focus on resilience and innovation is promising. Q&A insights show confidence in market positioning, though some responses lacked specificity. Overall, the positive financial metrics, optimistic guidance, and strategic positioning suggest a positive stock price movement, likely in the 2% to 8% range.
Commvault's strong financial performance, with a 23% revenue increase and 45% subscription revenue growth, coupled with a robust SaaS ARR growth of 68%, indicates positive momentum. The share repurchase program and high gross margins further boost sentiment. Despite competitive pressures and macroeconomic concerns, the company's strategic positioning in cyber resilience and strong guidance suggest a positive outlook. The Q&A session revealed management's confidence in their growth strategy and resilience, although some concerns about clarity on Clumio's contribution and growth versus margin trade-offs were noted. Overall, the positive financial metrics outweigh the uncertainties.
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