Commvault Announces Fiscal 2025 Fourth Quarter Financial Results
TINTON FALLS, N.J., April 29, 2025 /PRNewswire/ -- Commvault [Nasdaq: CVLT] today announced its financial results for the fourth quarter and fiscal year ended March 31, 2025.
"It was a record-breaking year at Commvault," said Sanjay Mirchandani, President and CEO. "Commvault surpassed all key metrics, ended the year with over 12,000 subscription customers, and is firmly positioned as a growth company with subscription revenue up 45% in Q4. We continue to deliver cloud-first innovations that solve a hard problem for customers - strengthening their cyber resilience."
Notes are contained at the end of this Press Release.
Fiscal 2025 Fourth Quarter Highlights -
-- Total revenues were $275 million, up 23% year over year
-- Subscription revenue was $173 million, up 45% year over year
-- Income from operations (EBIT) was $27 million, an operating margin of
9.7%
-- Non-GAAP EBIT(1) was $59 million, an operating margin of 21.5%
-- Operating cash flow was $77 million, with free cash flow(1) of $76
million
-- Fourth quarter share repurchases were $30 million, or approximately
182,000 shares of common stock
Fiscal 2025 Full Year Highlights -
-- Total revenues were $996 million, up 19% year over year
-- Total annualized recurring revenue (ARR)(2) grew to $930 million, up 21%
year over year
-- Subscription revenue was $590 million, up 37% year over year
-- Subscription ARR(2) grew to $780 million, up 31% year over year and
represents 84% of Total ARR(2)
-- Income from operations (EBIT) was $74 million, an operating margin of
7.4%
-- Non-GAAP EBIT(1) was $210 million, an operating margin of 21.1%
-- Full year operating cash flow was $207 million, with full year free cash
flow(1) of $204 million
-- Full year share repurchases were $165 million, or approximately
1,215,000 shares of common stock
-- On April 17, 2025, our Board of Directors increased our share repurchase
program to $250 million
Financial Outlook for First Quarter and Full Year Fiscal 2026(3) -
We are providing the following guidance for the first quarter of fiscal year 2026, based on current macroeconomic conditions:
-- Total revenues are expected to be between $266 million and $270 million
-- Subscription revenue is expected to be between $166 million and $170
million
-- Non-GAAP gross margin is expected to be between 81% and 82%
-- Non-GAAP operating margin(1) is expected to be approximately 21%
We are providing the following guidance for the full fiscal year 2026, based on current macroeconomic conditions:
-- Total revenues are expected to be between $1,130 million and $1,140
million
-- Total ARR(2) is expected to grow between 16% and 17% year over year
-- Subscription revenue is expected to be between $727 million and $732
million
-- Subscription ARR(2) is expected to grow between 22% and 23% year over
year
-- Non-GAAP gross margin is expected to be between 81% and 82%
-- Non-GAAP operating margin(1) is expected to be approximately 21%
-- Free cash flow(1) is expected to be between $210 million and $215
million
The above statements are based on current targets using exchange rates as of March 31, 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.
Conference Call Information
Commvault will host a conference call today, April 29, 2025 at 8:30 a.m. Eastern Time (5:30 a.m. Pacific Time) to discuss quarterly results. The live webcast and call dial-in numbers can be accessed by registering under the "News & Events" section of Commvault's website at ir.commvault.com under the "Investor Events" heading. An archived webcast of this conference call will also be available following the call.
About Commvault
Commvault (NASDAQ: CVLT) is the gold standard in cyber resilience, helping more than 100,000 organizations keep data safe and businesses resilient and moving forward. Today, Commvault offers the only cyber resilience platform that combines the best data security and rapid recovery at enterprise scale across any workload, anywhere--at the lowest TCO.
Safe Harbor Statement
This press release may contain forward-looking statements, including statements regarding financial projections, which are subject to risks and uncertainties, such as competitive factors, difficulties and delays inherent in the development, manufacturing, marketing and sale of software products and related services, general economic conditions, outcome of litigation and others. For a discussion of these and other risks and uncertainties affecting Commvault's business, see "Item 1A. Risk Factors" in our annual report on Form 10-K and "Item 1A. Risk Factors" in our most recent quarterly report on Form 10-Q. Statements regarding Commvault's beliefs, plans, expectations or intentions regarding the future are forward-looking statements, within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. All such forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Actual results may differ materially from anticipated results. Commvault does not undertake to update its forward-looking statements.
Revenue Overview
($ in thousands)
Q4'24 Q1'25 Q2'25 Q3'25 Q4'25
Revenue Summary:
Subscription $119,873 $124,080 $134,038 $158,321 $173,228
Perpetual license 15,196 13,736 10,522 16,423 14,962
Customer support 77,025 76,288 77,688 77,078 76,509
Other services 11,198 10,568 11,030 10,808 10,340
Total revenues $223,292 $224,672 $233,278 $262,630 $275,039
Q4'24 Q1'25 Q2'25 Q3'25 Q4'25
Y/Y Growth:
Subscription 27 % 28 % 37 % 39 % 45 %
Perpetual license (13) % 4 % (27) % 10 % (2) %
Customer support - % (1) % 1 % - % (1) %
Other services (20) % (2) % (7) % (1) % (8) %
Total revenues 10 % 13 % 16 % 21 % 23 %
FY'24 Y/Y Growth FY'25 Y/Y Growth
Revenue Summary:
Subscription $429,167 23 % $589,667 37 %
Perpetual license 57,613 (23) % 55,643 (3) %
Customer support 307,771 (2) % 307,563 - %
Other services 44,696 (6) % 42,746 (4) %
Total revenues $839,247 7 % $995,619 19 %
Constant Currency
($ in thousands)
The constant currency impact is calculated using the average foreign exchange rates from the prior year period and applying these rates to foreign-denominated revenues in the current corresponding period. Commvault analyzes revenue growth on a constant currency basis in order to provide a comparable framework for assessing how the business performed excluding the effect of foreign currency fluctuations. The non-GAAP financial measures presented in this press release should not be considered as a substitute for, or superior to, the measures of financial performance prepared in accordance with GAAP.
Subscription Perpetual Customer Other Total
license support services
Q4'24 Revenue as Reported (GAAP) $119,873 $15,196 $77,025 $11,198 $223,292
Q4'25 Revenue as Reported (GAAP) $173,228 $14,962 $76,509 $10,340 $275,039
% Change Y/Y (GAAP) 45 % (2) % (1) % (8) % 23 %
Constant Currency Impact $1,900 $242 $1,111 $(65) $3,188
% Change Y/Y Constant Currency 46 % - % 1 % (8) % 25 %
Subscription Perpetual Customer Other Total
license support services
FY'24 Revenue as Reported (GAAP) $429,167 $57,613 $307,771 $44,696 $839,247
FY'25 Revenue as Reported (GAAP) $589,667 $55,643 $307,563 $42,746 $995,619
% Change Y/Y (GAAP) 37 % (3) % - % (4) % 19 %
Constant Currency Impact $2,624 $283 $1,266 $(18) $4,155
% Change Y/Y Constant Currency 38 % (3) % - % (4) % 19 %
Revenues by Geography
($ in thousands)
Our Americas region includes the United States, Canada, and Latin America. Our International region primarily includes Europe, Middle East, Africa, Australia, India, Southeast Asia, and China.
Q4'24 Q1'25 Q2'25 Q3'25 Q4'25
Revenue Y/Y Revenue Y/Y Revenue Y/Y Revenue Y/Y Revenue Y/Y
Growth Growth Growth Growth Growth
Americas $131,069 7 % $138,725 14 % $144,408 20 % $155,435 24 % $169,384 29 %
International 92,223 14 % 85,947 13 % 88,870 10 % 107,195 17 % 105,655 15 %
Total revenues $223,292 10 % $224,672 13 % $233,278 16 % $262,630 21 % $275,039 23 %
FY'24 FY'25
Revenue Y/Y Revenue Y/Y
Growth Growth
Americas $498,545 6 % $607,952 22 %
International 340,702 8 % 387,667 14 %
Total revenues $839,247 7 % $995,619 19 %
Total ARR, Subscription ARR and SaaS ARR(2
)($ in thousands)
Q4'24 Q1'25 Q2'25 Q3'25 Q4'25
Total ARR(2) $769,946 $802,709 $853,265 $889,628 $930,051
Subscription ARR(2) $596,667 $635,910 $687,050 $734,212 $780,098
SaaS ARR(2) $167,509 $187,908 $214,832 $258,957 $281,045
For the three months ended March 31, 2025 -
Income from Operations (EBIT)
-- Income from operations (EBIT) was $27 million, an operating margin of
9.7%
-- Non-GAAP EBIT(1) was $59 million, an operating margin of 21.5%
GAAP and Non-GAAP Net Income(1)
-- GAAP net income was $31 million, or $0.69 per diluted share
-- Non-GAAP net income(1) was $46 million, or $1.03 per diluted share
Cash Summary and Share Repurchases
-- Cash flow from operations was $77 million in the fourth quarter
-- During the fourth quarter, Commvault repurchased $30 million, or
approximately 182,000 shares, of common stock at an average share price
of approximately $163.73 per share
For the year ended March 31, 2025 -
Income from Operations (EBIT)
-- Income from operations (EBIT) was $74 million, an operating margin of
7.4%
-- Non-GAAP EBIT(1) was $210 million, an operating margin of 21.1%
GAAP and Non-GAAP Net Income(1)
-- GAAP net income was $76 million, or $1.68 per diluted share
-- Non-GAAP net income(1) was $165 million, or $3.65 per diluted share
Cash Summary and Share Repurchases
-- Cash flow from operations was $207 million in the full fiscal year
-- As of March 31, 2025, ending cash and cash equivalents were
approximately $302 million
-- During the full fiscal year, Commvault repurchased $165 million, or
approximately 1,215,000 shares, of common stock at an average share
price of approximately $135.77 per share
Table I
Commvault Systems, Inc.
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
Three Months Ended Year Ended
March 31,
March 31,
2025 2024 2025 2024
Revenues:
Subscription $173,228 $119,873 $589,667 $429,167
Perpetual license 14,962 15,196 55,643 57,613
Customer support 76,509 77,025 307,563 307,771
Other services 10,340 11,198 42,746 44,696
Total revenues 275,039 223,292 995,619 839,247
Cost of revenues:
Subscription 25,801 15,486 88,899 58,406
Perpetual license 312 316 1,500 2,168
Customer support 13,746 15,806 57,680 60,752
Other services 7,907 7,538 30,956 30,284
Total cost of revenues 47,766 39,146 179,035 151,610
Gross margin 227,273 184,146 816,584 687,637
Operating expenses:
Sales and marketing 120,152 94,458 434,117 354,994
Research and development 39,333 35,244 146,286 132,328
General and administrative 38,274 29,938 138,375 113,997
Restructuring 812 4,548 10,026 4,548
Change in contingent consideration (426) 2,060
Depreciation and amortization 2,401 1,768 9,072 6,415
Impairment charges - 2,910
Total operating expenses 200,546 165,956 742,846 612,282
Income from operations 26,727 18,190 73,738 75,355
Interest income 1,556 1,893 6,654 5,423
Interest expense (103) (104) (416) (415)
Other income, net 453 3,076 1,077 3,250
Income before income taxes 28,633 23,055 81,053 83,613
Income tax expense (benefit) (2,360) (103,065) 4,947 (85,293)
Net income $30,993 $126,120 $76,106 $168,906
Net income per common share:
Basic $0.70 $2.89 $1.74 $3.85
Diluted $0.69 $2.81 $1.68 $3.75
Weighted average common shares outstanding:
Basic 44,066 43,672 43,850 43,885
Diluted 45,158 44,917 45,187 45,100
Table II
Commvault Systems, Inc.
Condensed Consolidated Balance Sheets
(In thousands)
(Unaudited)
March 31, March 31,
2025 2024
ASSETS
Current assets:
Cash and cash equivalents $302,103 $312,754
Trade accounts receivable, net 251,995 222,683
Assets held for sale 34,770 38,680
Other current assets 46,189 21,009
Total current assets 635,057 595,126
Deferred tax assets, net 133,378 111,181
Property and equipment, net 8,294 7,961
Operating lease assets 10,124 10,545
Deferred commissions cost 79,309 62,837
Intangible assets, net 20,737 1,042
Goodwill 185,255 127,780
Other assets 46,112 27,441
Total assets $1,118,266 $943,913
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable $373 $299
Accrued liabilities 147,133 117,244
Current portion of operating lease liabilities 4,614 4,935
Deferred revenue 402,930 362,450
Total current liabilities 555,050 484,928
Deferred revenue, less current portion 223,282 168,472
Deferred tax liabilities 1,384 1,717
Long-term operating lease liabilities 6,338 7,155
Other liabilities 7,090 3,556
Total stockholders' equity 325,122 278,085
Total liabilities and stockholders' equity $1,118,266 $943,913
Table III
Commvault Systems, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended Year Ended
March 31, March 31,
2025 2024 2025 2024
Cash flows from operating activities
Net income $30,993 126,120 $76,106 $168,906
Adjustments to reconcile net income to net cash provided by
operating activities:
Depreciation and amortization 2,429 1,796 9,187 6,530
Noncash stock-based compensation 28,992 22,610 113,262 94,551
Noncash change in fair value of equity securities (396) 191 (364) 17
Noncash change in fair value of contingent consideration (426) 2,060
Noncash impairment charges - 2,910
Noncash operating lease expense 2,082 2,439 6,408 6,685
Deferred income taxes (17,194) (109,598) (23,474) (109,598)
Amortization of deferred commissions cost 9,658 6,987 33,414 26,531
Changes in operating assets and liabilities:
Trade accounts receivable, net 3,425 (1,049) (62,012) (21,725)
Operating lease liabilities (1,963) (2,308) (7,136) (6,135)
Other current assets and Other assets (9,051) (1,634) (8,615) 336
Deferred commissions cost (20,316) (9,411) (49,848) (29,952)
Accounts payable 292 87 (948) 195
Accrued liabilities 15,140 16,146 25,235 16,998
Deferred revenue 29,749 27,951 87,659 50,394
Other liabilities 3,541 (342) 3,538 65
Net cash provided by operating activities 76,955 79,985 207,382 203,798
Cash flows from investing activities
Purchase of property and equipment (783) (859) (3,756) (4,086)
Purchase of equity securities (545) (373) (1,333) (1,435)
Business combination, net of cash acquired 598 (65,311)
Net cash used in investing activities (730) (1,232) (70,400) (5,521)
Cash flows from financing activities
Repurchase of common stock (29,821) (50,366) (165,015) (184,021)
Proceeds from stock-based compensation plans 6,437 5,687 17,537 13,440
Payment on contingent liability (340) (340)
Net cash used in financing activities (23,724) (44,679) (147,818) (170,581)
Effects of exchange rate - changes in cash 6,027 (5,630) 185 (2,720)
Net increase (decrease) in cash and cash equivalents 58,528 28,444 (10,651) 24,976
Cash and cash equivalents at beginning of period 243,575 284,310 312,754 287,778
Cash and cash equivalents at end of period $302,103 $312,754 $302,103 $312,754
Supplemental disclosures of noncash activities
Issuance of common stock for business combination
$ -
$ - $4,900
$ -
Operating lease liabilities arising from obtaining right-of-use assets $1,109 $35 $5,796 $5,528
Table IV
Commvault Systems, Inc.
Reconciliation of GAAP to Non-GAAP Financial Measures
(In thousands, except per share data)
(Unaudited)
Three Months Ended Year Ended
March 31, March 31,
2025 2024 2025 2024
Non-GAAP financial measures and reconciliation:
GAAP income from operations $26,727 $18,190 $73,738 $75,355
Noncash stock-based compensation4 28,840 21,093 108,615 93,034
FICA and payroll tax expense related to stock-based compensation5 1,767 1,073 5,459 3,285
Restructuring6 812 4,548 10,026 4,548
Amortization of intangible assets7 1,176 312 3,705 1,250
Litigation settlement8 - 675
Business combination costs9 201 2,541
Noncash impairment charges10 - 2,910
Change in contingent consideration11 (426) 2,060
Non-GAAP income from operations $59,097 $45,216 $209,729 $177,472
GAAP net income $30,993 $126,120 $76,106 $168,906
Noncash stock-based compensation4 28,840 21,093 108,615 93,034
FICA and payroll tax expense related to stock-based compensation5 1,767 1,073 5,459 3,285
Restructuring6 812 4,548 10,026 4,548
Amortization of intangible assets7 1,176 312 3,705 1,250
Litigation settlement8 - 675
Business combination costs9 201 2,541
Noncash impairment charges10 - 2,910
Change in contingent consideration11 (426) 2,060
Gain on escrow payment12 - (1,670) (1,670)
Non-GAAP provision for income taxes adjustment13 (17,000) (116,136) (47,143) (134,989)
Non-GAAP net income $46,363 $35,340 $164,954 $134,364
GAAP diluted earnings per share $0.69 $2.81 $1.68 $3.75
Noncash stock-based compensation4 0.64 0.47 2.40 2.06
FICA and payroll tax expense related to stock-based compensation5 0.04 0.02 0.12 0.07
Restructuring6 0.02 0.10 0.22 0.10
Amortization of intangible assets7 0.03 0.01 0.08 0.03
Litigation settlement8 - 0.01
Business combination costs9 - 0.06
Noncash impairment charges10 - 0.06
Change in contingent consideration11 (0.01) 0.05
Gain on escrow payment12 - (0.04) (0.04)
Non-GAAP provision for income taxes adjustment13 (0.38) (2.58) (1.03) (2.99)
Non-GAAP diluted earnings per share $1.03 $0.79 $3.65 $2.98
GAAP diluted weighted average shares outstanding 45,158 44,917 45,187 45,100
Three Months Ended Year Ended
March 31,
March 31,
2025 2024 2025 2024
Non-GAAP free cash flow reconciliation:
GAAP cash provided by operating activities $76,955 $79,985 $207,382 $203,798
Purchase of property and equipment (783) (859) (3,756) (4,086)
Non-GAAP free cash flow $76,172 $79,126 $203,626 $199,712
Use of Non-GAAP Financial Measures
Commvault has provided in this press release the following non-GAAP financial measures: non-GAAP income from operations (EBIT), non-GAAP income from operations margin, non-GAAP gross margin, non-GAAP net income, non-GAAP diluted earnings per share, non-GAAP free cash flow, annualized recurring revenue (ARR), subscription ARR and SaaS ARR. This financial information has not been prepared in accordance with GAAP. Commvault uses these non-GAAP financial measures internally to understand, manage and evaluate its business and make operating decisions. Commvault believes that the use of these non-GAAP financial measures, when used as a supplement to GAAP financial measures, provides an additional tool for investors to use in evaluating ongoing operating results and trends, and in comparing its financial results with other companies in Commvault's industry, many of which present similar non-GAAP financial measures to the investment community. Commvault has also provided its revenues on a constant currency basis. Commvault analyzes revenue growth on a constant currency basis in order to provide a comparable framework for assessing how the business performed excluding the effect of foreign currency fluctuations.
All of these non-GAAP financial measures should be considered as a supplement to, and not as a substitute for, financial information prepared in accordance with GAAP. Investors are encouraged to review the reconciliation of these non-GAAP measures to their most directly comparable GAAP financial measures, which are included in this press release.
Non-GAAP income from operations and non-GAAP income from operations margin. These non-GAAP financial measures exclude noncash stock-based compensation charges and additional Federal Insurance Contribution Act (FICA) and related payroll tax expense incurred by Commvault when employees exercise in-the-money stock options or vest in restricted stock awards. Commvault has also excluded restructuring costs, noncash amortization of intangible assets, litigation settlement, business combination costs, noncash impairment charges, changes in the estimated fair value of contingent consideration, and a gain related to a non-refundable escrow payment associated with assets held for sale from its non-GAAP results. These expenses are further discussed in Table IV. Commvault believes that these non-GAAP financial measures are useful metrics for management and investors because they compare Commvault's core operating results over multiple periods. When evaluating the performance of Commvault's operating results and developing short- and long-term plans, Commvault does not consider such expenses.
Although noncash stock-based compensation and the additional FICA and related payroll tax expenses are necessary to attract and retain employees, Commvault places its primary emphasis on stockholder dilution as compared to the accounting charges related to such equity compensation plans. Commvault believes that providing non-GAAP financial measures that exclude noncash stock-based compensation expense and the additional FICA and related payroll tax expenses incurred on stock option exercises and vesting of restricted stock awards allow investors to make meaningful comparisons between Commvault's operating results and those of other companies.
There are a number of limitations related to the use of non-GAAP income from operations and non-GAAP income from operations margin. The most significant limitation is that these non-GAAP financial measures exclude certain operating costs, primarily related to noncash stock-based compensation, which is of a recurring nature. Noncash stock-based compensation has been, and will continue to be for the foreseeable future, a significant recurring expense in Commvault's operating results. In addition, noncash stock-based compensation is an important part of Commvault's employees' compensation and can have a significant impact on their performance. The following table presents the stock-based compensation expense included in cost of revenues, sales and marketing, research and development and general and administrative ($ in thousands):
Three Months Ended March 31, Year Ended March 31,
2025 2024 2025 2024
Cost of revenues $1,324 $1,608 $5,744 $6,832
Sales and marketing 12,599 6,796 47,627 36,630
Research and development 6,225 5,402 24,028 21,585
General and administrative 8,692 7,287 31,216 27,987
Stock-based compensation expense $28,840 $21,093 $108,615 $93,034
The table above excludes stock-based compensation expense related to the Company's restructuring activities described below in Note 6.
The components that Commvault excludes in its non-GAAP financial measures may differ from the components that its peer companies exclude when they report their non-GAAP financial measures. Due to the limitations related to the use of non-GAAP measures, Commvault's management assists investors by providing a reconciliation of each non-GAAP financial measure to the most directly comparable GAAP financial measure. Commvault's management uses non-GAAP financial measures only in addition to, and in conjunction with, results presented in accordance with GAAP.
Non-GAAP gross margin. Commvault defines this non-GAAP financial measure as GAAP gross margin adjusted to exclude cost of revenues related to noncash stock-based compensation.
Non-GAAP net income and non-GAAP diluted earnings per share (EPS). In addition to the adjustments discussed in non-GAAP income from operations, non-GAAP net income and non-GAAP diluted EPS incorporates a non-GAAP effective tax rate of 24%. Beginning in fiscal 2025, Commvault lowered its estimated non-GAAP effective tax rate from 27% to 24%. Commvault believes that a 24% rate more closely aligns with its effective tax rate expectations over the next few years.
Commvault anticipates that in any given period its non-GAAP tax rate may be either higher or lower than the GAAP tax rate as evidenced by historical fluctuations. The GAAP tax rates in recent fiscal years were not meaningful percentages due to the dollar amount of GAAP pre-tax income. For the same reason as the GAAP tax rates, the estimated cash tax rates in recent fiscal years are not meaningful percentages. Commvault defines its cash tax rate as the total amount of cash income taxes payable for the fiscal year divided by consolidated GAAP pre-tax income. Over time, Commvault believes its GAAP and cash tax rates will align.
Commvault considers non-GAAP net income and non-GAAP diluted EPS useful metrics for Commvault management and its investors for the same basic reasons that Commvault uses non-GAAP income from operations and non-GAAP income from operations margin. In addition, the same limitations as well as management actions to compensate for such limitations described above also apply to Commvault's use of non-GAAP net income and non-GAAP diluted EPS.
Non-GAAP free cash flow. Commvault defines this non-GAAP financial measure as net cash provided by operating activities less purchases of property and equipment. Commvault considers non-GAAP free cash flow a useful metric for Commvault management and its investors in evaluating Commvault's ability to generate cash from its business operations. In addition, the same limitations as well as management actions to compensate for such limitations described above also apply to Commvault's use of non-GAAP free cash flow.
Forward-looking non-GAAP measures. In this press release, Commvault presents certain forward-looking non-GAAP metrics. Commvault cannot provide a reconciliation to the comparable GAAP metric without unreasonable efforts, as certain financial information, the probable significance of which may be material, is not available and cannot be reasonably estimated.
Notes
1. A reconciliation of GAAP to non-GAAP results has been provided in
Financial Statement Table IV included in this press release. An
explanation of these measures is also included under the heading "Use of
Non-GAAP Financial Measures."
2. Annualized recurring revenue (ARR) is defined as the annualized recurring
value of all active contracts at the end of a reporting period. It
includes the following contract types: subscription (including term
license contracts, SaaS and utility software), maintenance contracts
related to perpetual licenses, other extended maintenance contracts
(enterprise support), and managed services. It excludes any element of
the arrangement that is not expected to recur, primarily perpetual
licenses and most professional services. Subscription ARR includes only
term license contracts, SaaS and utility software arrangements. Contracts
are annualized by dividing the total contract value by the number of days
in the contract term, then multiplying by 365.ARR should be viewed
independently of GAAP revenue, deferred revenue and unbilled revenue and
is not intended to be combined with or to replace those items. ARR is not
a forecast of future revenue. Management believes that reviewing this
metric, in addition to GAAP results, helps investors and financial
analysts understand the value of Commvault's recurring revenue streams
presented on an annualized basis.
3. Commvault does not provide forward-looking guidance on a GAAP basis as
certain financial information, the probable significance of which cannot
be determined, is not available and cannot be reasonably estimated. See
"Use of Non-GAAP Financial Measures" for additional explanation.
4. Represents noncash stock-based compensation charges associated with
restricted stock units granted and our Employee Stock Purchase Plan,
exclusive of stock-based compensation expense related to Commvault's
restructuring activities described below in Note 6.
5. Represents additional FICA and related payroll tax expenses incurred by
Commvault when employees exercise in-the-money stock options or vest in
restricted stock awards.
6. These restructuring charges relate primarily to severance and related
costs associated with headcount reductions and stock-based compensation
related to modifications of existing unvested awards granted to certain
employees impacted by our restructuring plans.
7. Represents noncash amortization of intangible assets.
8. During the first quarter of fiscal 2025, we entered into a settlement
agreement resulting in a payment of approximately $1.5 million which
resolved certain legal matters. Approximately $0.7 million was recorded
in general and administrative expenses for the year ended March 31, 2025,
and the remaining $0.8 million was incurred in a prior period that is not
presented in the consolidated statements of operations.
9. During fiscal 2025, Commvault incurred costs related to the acquisitions
of Appranix, Inc. and Clumio, Inc., including legal, accounting and
advisory services. Management believes, when used as a supplement to GAAP
results, that the exclusion of these costs will help investors and
financial analysts understand Commvault's operating results and
underlying operational trends as compared to other periods.
10. Represents noncash impairment charges of assets held for sale.
11. Represents the change in the estimated fair value of the contingent
consideration arrangement related to the acquisition of Appranix, Inc.
12. Represents a non-refundable escrow payment received related to assets
held for sale.
13. The provision for income taxes is adjusted to reflect Commvault's
estimated non-GAAP effective tax rate of 24% for fiscal 2025, and 27%
for fiscal 2024. Beginning in fiscal 2025, Commvault lowered its
estimated non-GAAP effective tax rate from 27% to 24%. Commvault
believes that a 24% rate more closely aligns with its effective tax rate
expectations over the next few years.
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SOURCE COMMVAULT
