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Commvault revenue plateau set to end A 4-quarter revenue plateau at the $313 million level is set to end as Commvault predicts fresh growth. Commvault brought in $312.4 million in second fiscal 2027 quarter revenues, up 13 percent Y/Y and beating its $310 million mid-point guidance. There was a $29.1 million GAAP net income (profit), up 97.6 percent. It registered an increase of 550 in net new subscription customers, , making its total 15,750, and subscription ARR is now $1.194 billion, 20 percent higher Y/Y. Operating cash flow was $75 million with $71 million in free cash flow. President and CEO Sanjay Mirchandani said: ,"Enterprises globally are increasingly turning to Commvault to stay resilient as they navigate more data, more identities, and greater complexity. We believe our strong Q2 results reflect that momentum, driving durable growth and shareholder value." Commvault’s revenues have been flat for four successive quarters as a consequence of its decision to switch from its legacy perpetual license business model to a subscription, SaaS-based one. Subscription revenue was $268.5 million, 20 percent higher Y/Y, with the SaaS component $106 million, rising 33 percent Y/Y, Subscription revenues represented 85 percent of total revenues. That percentage was 85 in the prior quarter, 84 in the one before that, and 82 before that. Subscription revenue growth comes from new customers and from cross-selling new subscriptions to existing customers. William Blair analyst Jason Ader said: “Multi-product adoption continues to improve, with 53 percent of managed SaaS customers using two or more products, up from roughly 45 percent a year ago and four points sequentially. Management highlighted strength among customers using three to eight products, while identity resilience and data security contributed approximately 30 percent of net new ARR and Active Directory ARR nearly doubled year-over-year. Cloud protection offerings, including AWS Clumio, Azure DevOps, and Google Workspace, are emerging as additional cross-sell opportunities.” He cautions that: “broader product adoption has yet to translate into accelerating expansion across the installed base.” The net dollar retention rate of 113 percent was down 1 percent Q/Q and Y/Y as evidence of this. The Q3 outlook is for $295 million +/- $2 million in subscription revenues, up 15 percent annually, and the full year subscription revenue outlook has been increased from a $1.205 billion mid-point to a $1.210 billion +/- $5 million number, implying 19 percent growth. Q3 revenues are guided to be $339 million, up 8 percent Y/Y; the 4-quarter c$313 million revenue plateau is set to end. Full year revenue is now forecast to be $1.305 billion +/- $5 million, up 10 percent Y/Y. Ader said: “The second-half outlook is supported by a larger renewal pool and expanding cross-sell opportunities, with SaaS expected to remain the largest contributor to net new ARR and exceed $500 million by year-end.” Bootnote The net dollar retention rate calculates what customers spend at the end of a reporting period (fiscal quarter) as a percentage of what they spent at the start. It begins with the annual recurring revenue (ARR) or subscription revenue from a cohort of customers at the beginning of the period, then adjusts for what happened with those same customers by the end of the period: - Adds expansion (upsells, cross-sells, price increases, more seats/usage) - Subtracts churn (customers who left) and contraction (customers who reduced spending)
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