Commvault: Fiscal 3Q17 Financial Results

Commvault Systems, Inc. announced its financial results for the third quarter ended December 31, 2016.

N. Robert Hammer, chairman, president and CEO, stated: “Our third quarter results demonstrated continued business momentum and we reported strong financial performance highlighted by record quarterly revenue of $165.8 million and sequential software revenue growth of 10% which was driven by significant growth in enterprise software revenue transactions in our international operations. Our financial results are validating our leadership position in the enterprise market with our Commvault Data Platform with a cloud focus which has continued to drive a substantial increase in the number of petabytes of data being managed by Commvault software within public cloud environments. The Commvault Data Platform is being used by customers to move, use, secure and protect their data on-premise, on mobile devices and in public clouds. Finally, we remained opportunistic during the third fiscal quarter, repurchasing $25 million of our common stock.”

Total revenues for the third quarter of fiscal 2017 were $165.8 million, an increase of 7% year-over-year, and 4% sequentially. On a constant currency basis, total revenue increased 6% sequentially.

Software revenue was $77.3 million, an increase of 8% year-over-year, and 10% sequentially. On a sequential constant currency basis software revenue increased 12%. Services revenue in the quarter was $88.5 million, an increase of 5% year-over-year, and flat on a sequential basis.

On a GAAP basis, income from operations (EBIT) was $1.2 million for the third quarter compared to income of $3.5 million in the prior year. Non-GAAP EBIT increased 1% to $21.1 million in the quarter compared to $21.0 million in the prior year.

For the third quarter of fiscal 2017, Commvault reported GAAP net loss of less than $0.1 million, or $(0.00) per diluted share. Non-GAAP net income for the quarter was $13.3 million, or $0.28 per diluted share, unchanged versus the third quarter of fiscal 2016.

Operating cash flow totaled $26.8 million for the third quarter of fiscal 2017 compared to $15.8 million in the prior year quarter. Total cash and short-term investments were $437.2 million as of December 31, 2016 compared to $387.2 million as of March 31, 2016.

During the quarter, the company repurchased $25.0 million of common stock (477,000 shares) under its share repurchase program. On January 18, 2017, the board extended the expiration date of the share repurchase program to March 31, 2018 and authorized an increase to the existing share repurchase program so that $150.0 million is now available. There were no borrowings against the revolving credit facility.

Recent Business Highlights:
    •    On December 21, 2016, the company announced its second annual customer conference, Commvault GO 2017, will be held Nov. 6-8, 2017 in Washington D.C. Commvault GO is the industry event dedicated to protecting and enabling digital business. Building on the success of its sold-out inaugural conference held in October 2016, the event will bring together industry thought leaders, customers, partners and Commvault executives to discuss market forces and technology innovations – including the emergence of software- efined storage, the continued rise of big data, the move toward compute in the cloud, data protection market dynamics and showcase new Commvault solutions.
    •    On December 19, 2016, the firm announced the launch of Commvault Mobile Advantage App and the Automated Proactive Solution System (APSS) framework, bringing new innovations in mobile access, control and automation to customers. The innovations coincide with the company receiving above a 98% customer satisfaction rating in its annual support and services survey review – continuing its excellence and support in the rapidly evolving data protection and information management market. The rating marks the sixth consecutive year that Commvault has exceeded industry averages in performance and customer satisfaction, enabling customers to reduce risks, lower costs, and maximize the return on their software investment.