Commvault: Fiscal 4Q19 Financial Results

Commvault Systems, Inc. announced its financial results for the fourth quarter and fiscal year ended March 31, 2019.

“Commvault has implemented extensive operational and organizational changes over the past twelve months, which have enabled us to reduce costs, increase repeatable revenues, and deliver significant year-over-year earnings growth. However, we have more work to do to ensure that Commvault reaches its potential,” said Sanjay Mirchandani, president and CEO. “Since joining Commvault a few months ago, I’ve consistently heard from customers and partners that Commvault has the best technology to protect, manage and use data. Our record of innovation has, and will, continue to be core to our success. To better capture the market opportunity that our innovation creates, we are focused on simplifying our business and improving execution. Actions are underway in each of these areas, and our employees are energized about where Commvault is heading. I am confident we have the foundation necessary to drive increased levels of profitable growth and value creation.”

Total revenues for 4FQ19 were $181.4 million, a decrease of 2% Y/Y and Q/Q. Software and products revenue in 4FQ19 was $80.8 million, a decrease of 3% Y/Y and 4% Q/Q. Services revenue in 4FQ19 was $100.6 million, a decrease of 1% Y/Y and an increase of 1% Q/Q.

For FY19, total revenues were $711.0 million, an increase of 2% from FY18. Software and products revenue for FY19 was $309.9 million, a decrease of 1% from FY18. Services revenue for FY19 was $401.1 million, an increase of 3% from FY18.

On a GAAP basis, income from operations (EBIT) decreased to $0.3 million for 4FQ19 compared to $4.6 million in 4FQ18. Fourth quarter GAAP results include approximately $13.4 million of non-cash expense for stock-based compensation modifications related to the transition of senior management. Non-GAAP income from operations (EBIT) increased to $30.9 million in 4FQ19 compared to $22.5 million in 4FQ18, an increase of 37%.

On a GAAP basis, income from operations (EBIT) for FY19 was $4.9 million. Non-GAAP income from operations (EBIT) increased 47% to $111.9 million in FY19 compared to $76.0 million in FY18.

For 4FQ19, the company reported net loss of $2.2 million. Non-GAAP net income for the quarter increased to $23.9 million, or $0.51 per diluted share, from $14.5 million, or $0.31 per diluted share, in 4FQ18.

For FY19, Commvault reported net income of $3.6 million. Non-GAAP net income for this fiscal year increased to $85.7 million, or $1.80 per diluted share, from $48.7 million, or $1.03 per diluted share, in FY18.

Operating cash flow totaled $36.6 million for 4FQ19 compared to $23.3 million in 4FQ18. For the full fiscal year, operating cash flow was $110.2 million, compared to $84.2 million for fiscal 2018. Total cash and short-term investments were $458.3 million as of March 31, 2019 compared to $462.4 million as of March 31, 2018.

During the fiscal fourth quarter, the firm repurchased $40.0 million of common stock (611 thousand shares), bringing FY19 total repurchases to $132.7 million (2.1 million shares). On April 18, 2019, the board of directors increased the current share repurchase authorization that expires March 31, 2020, so that $200 million was available.