Commvault: Fiscal 2Q26 Financial Results

Summary:

Total revenues of $276 million, up 18% YoY
Annualized recurring revenue (ARR) surpassed $1 billion milestone, ahead of March 2026 target
Operating cash flow of $77 million, free cash flow of $74 million

Commvault Systems Inc., announced its financial results for the fiscal second quarter ended September 30, 2025.

“Commvault delivered a strong quarter fueled by solid ARR and SaaS growth that accelerated a key milestone for the company – achieving $1 billion in total ARR – two quarters earlier than projected,” said Sanjay Mirchandani, President and CEO, Commvault. “As enterprises globally rely on Commvault to be resilient, our cloud-first, AI-enabled cyber resilience platform is more relevant than ever.”

Second Quarter Fiscal 2026 Highlights

Total revenues were $276 million, up 18% YoY
Total ARR grew to $1,043 million, up 22% YoY, or 21% on a constant currency basis using March 31, 2025 spot rates
Subscription revenue was $173 million, up 29% YoY, inclusive of term-based license revenue of $93 million, up 10% YoY, and SaaS revenue of $80 million, up 61% YoY
Subscription ARR grew to $894 million, up 30% YoY, or 29% on a constant currency basis using March 31, 2025 spot rates
Income from operations (EBIT) was $12 million, an operating margin of 4.5%
Non-GAAP EBIT was $51 million, an operating margin of 18.6%
Operating cash flow was $77 million, with free cash flow of $74 million

Recent Business Highlights

Commvault completed its acquisition of Satori Cyber Ltd., a data and AI security company, expanding its cyber-resiliency platform to help enterprises protect sensitive data and manage AI-driven risks across hybrid and multi-cloud environments.
Commvault launched Clumio for Apache Iceberg on AWS, designed to deliver Iceberg-aware, air-gapped resilience for AI and analytics data lakehouses.
Commvault introduced HyperScale Edge (for remote/edge locations) and HyperScale Flex (for high-performance, large-scale workloads) to its HyperScale portfolio, extending enterprise-grade data protection and cyber resilience and providing customers more choice for on-premise cyber resilience.
Commvault and BeyondTrust announced a new integration between the Commvault Cloud platform and BeyondTrust Password Safe, enabling customers to further mitigate credential risk, improve security posture, and enhance data recovery efficiency.

Financial Outlook for Third Quarter and Full Year Fiscal 2026

We are providing the following guidance for the third quarter of fiscal year 2026, based on current macroeconomic conditions:

Total revenues are expected to be between $298 million and $300 million
Subscription revenue is expected to be between $195 million and $197 million
Non-GAAP gross margin is expected to be between 80% and 81%
Non-GAAP EBIT margin is expected to be between 18% and 19%

We are providing the following updated guidance for the full fiscal year 2026, based on current macroeconomic conditions:

Total revenues are expected to be between $1,161 million and $1,165 million
Total ARR is expected to grow between 18% and 19% YoY
Subscription revenue is expected to be between $753 million and $757 million
Subscription ARR is expected to grow between 24% and 25% YoY
Non-GAAP gross margin is expected to be between 80.5% and 81.5%
Non-GAAP EBIT margin is expected to be between 18.5% and 19.5%
Free cash flow is expected to be between $225 million and $230 million

The above statements are based on the incorporation of actual second quarter results, current targets and the acquisition of Satori Cyber Ltd. which closed on August 28, 2025. These statements are forward-looking and made pursuant to the safe harbor provisions discussed in detail below. We do not undertake any obligation to update these forward-looking statements. Actual results may differ materially from anticipated results.

Comments

These results for Commvault demonstrated the strategy started with the arrival of Sanjay Mirchandani, President and CEO, almost 7 years ago. And under this long tenure taken and chosen decisions can be seen. For sure the revenue, the ecosystem, the SaaS, the cybersecurity adoption with new approaches and solutions plus AI belongs to this list and confirms the role for several decades of Commvault on the data management and protection and more recently cyber resilience landscape. It is perfectly illustrated by the Coldago Research Map 2024 for Modern Data Protection.

Click to enlarge

The Q2FY2026 revenue appears to be a bit lower - 2% - from previous quarter but it is very strong. The first 6 months generated $558 million up 22% with the first 6 months last year. As said the ARR passed the billion dollars mark and invite us to think that the company should also pass the $300 million quarter mark soon which also will be a key milestone.