Key Highlights

  • Commvault reported fiscal second-quarter total Revenue of $312.4 million, up 13 per cent, with subscription ARR of $1,103.9 million, up 20 per cent.
  • GAAP Net Income was $29.1 million ($0.69 per diluted share) and non-GAAP Diluted Earnings per Share were $1.38.
  • The company raised fiscal 2027 subscription ARR guidance to $1,205 million to $1,215 million.

What Commvault reported on 27 October

Commvault Systems, Inc. (NASDAQ:CVLT) published results for its fiscal second quarter, which ended on 30 September 2026, in a filing dated 27 October 2026. Total revenue was $312.4 million, up 13 per cent year on year. Subscription revenue was $268.5 million, up 21 per cent, and SaaS revenue was $106.2 million, up 33 per cent.

Subscription annual Recurring Revenue (ARR) reached $1,103.9 million, up 20 per cent. That is about $50 million higher than the $1,054 million reported for the June quarter. Net new subscription ARR was $51.0 million on a constant-currency basis, and subscription net dollar retention, a customer expansion measure, was 113 per cent.

Profitability, cash and buybacks

GAAP net income was $29.1 million, or $0.69 per diluted share, up from $0.33 a year earlier. Non-GAAP diluted earnings per share were $1.38, compared with $0.91. GAAP Operating Income was $30.4 million, a Margin of 9.7 per cent, while non-GAAP operating income was $68.3 million, a margin of 21.9 per cent.

Operating cash flow was $74.8 million and free cash flow was $70.9 million. Cash and equivalents were $897.3 million, compared with $930 million at the end of June. In the first six months of the fiscal year the company repurchased about 906,000 shares for $119 million.

Against its own guidance

The quarter can be compared with the guidance given in July. Management then expected second-quarter subscription revenue of $264 million to $268 million and a non-GAAP EBIT margin of about 20 per cent. Reported subscription revenue of $268.5 million sits just above the top of that range, and the 21.9 per cent non-GAAP Operating Margin is higher than the 20 per cent indicated, although the two margin measures are labelled differently and should be compared cautiously.

Total revenue of $312.4 million was slightly below the $314.1 million of the previous quarter, so sequential movement in total revenue was not uniformly upward, even though year-on-year growth was 13 per cent.

Updated outlook

The following are management estimates rather than results. For the third quarter, Commvault expects subscription revenue of $293 million to $297 million and a non-GAAP EBIT margin of 20.5 per cent to 21.0 per cent. For the full fiscal year 2027, it now expects subscription revenue of $1,127 million to $1,133 million, subscription ARR of $1,205 million to $1,215 million, a non-GAAP EBIT margin of 21.0 per cent to 21.5 per cent and free cash flow of $255 million to $265 million.

In July the ranges were $1,119 million to $1,129 million for subscription revenue, $1,200 million to $1,210 million for ARR, about 21 per cent for margin and $250 million to $260 million for free cash flow, so each has edged higher. The guided third-quarter subscription revenue is about $25 million above the second-quarter figure, a step the release material does not explain.

Product news and watch points

Chief executive Sanjay Mirchandani said resilience continues to be a Business imperative as AI raises both innovation and risk. The company also announced Active Directory Pre Recover, an identity resilience offering, expanded FedRAMP High authorised cyber resilience services for managed service providers, and an integration of Threat Scan with Google Threat Intelligence.

Items to watch include whether ARR growth holds near 20 per cent, how the third-quarter subscription step-up is explained, and whether Buybacks continue at the second-quarter pace.