Rubrik's Subscription Revenue Expands: A Sign for More Upside?

Rubrik RBRK is benefiting from strong growth in subscription revenue, which reached $297 million in the second quarter of fiscal 2026, marking a 55% year-over-year increase.  This growth is driven by the company’s focus on cyber resilience and its ability to deliver advanced solutions across data security, identity recovery and cloud protection. 

The company’s subscription Annual Recurring Revenue (ARR) surpassed $1.25 billion, increasing 36% year over year, with $71 million in net new subscription ARR added in the second quarter of fiscal 2026. This growth reflects Rubrik’s success in expanding its customer base and deepening its footprint within existing accounts.  Customers with more than $100K in subscription ARR grew 27% year over year, reaching 2,505, and now contribute 85% of total subscription ARR. 

Rubrik’s focus on cloud-based solutions has also bolstered subscription revenue. Cloud ARR grew 57% year over year to $1.1 billion, driven by the adoption of Rubrik Security Cloud.

Rubrik’s expanding portfolio has been a major growth driver of its success. In July 2025, Rubrik announced expanded immutability for Amazon RDS for PostgreSQL and comprehensive protection for Amazon DynamoDB, reinforcing its leadership in cloud data protection.

Further expanding its portfolio, the company in September announced the launch of Rubrik Okta Recovery at Oktane 2025, providing automated, immutable backups and granular, in-place recovery for Okta Identity Provider environments. This solution extends Rubrik’s identity protection beyond Active Directory and Entra ID, enabling organizations to quickly recover critical identity data and configurations.

Rubrik Faces Stiff Competition

Rubrik’s competitive position is under pressure from various data management and protection vendors, including Commvault CVLT and International Business Machines IBM.

In September, Commvault announced the launch of Clumio for Apache Iceberg on AWS, the industry’s first Iceberg-aware, air-gapped cyber resilience solution. This innovation by Commvault enables fast, consistent recovery of AI and analytics workloads while enhancing data lakehouse protection, compliance, and cost efficiency.

International Business Machines’ growth is expected to be driven primarily by analytics, cloud computing, and security in the long run.  In July 2025, International Business Machines’ subsidiary Neudesic announced that it had renewed its Cloud Security Specialization with Microsoft Corporation. This renewal aims to keep providing strong security solutions for hybrid and multi-cloud environments.

RBRK’s Share Price Performance, Valuation, and Estimates

RBRK’s shares have gained 20.3% year to date, outperforming the broader Zacks Computer & Technology sector’s return of 23% and the Internet - Software industry’s appreciation of 18%.

RBRK Stock Performance

RBRK shares are overvalued, with a forward 12-month Price/Sales of 10.7X compared with the Computer & Technology sector’s 6.92X. RBRK has a Value Score of F.

Price/Sales (F12M)

For fiscal 2026, the Zacks Consensus Estimate for loss is pegged at 49 cents per share, unchanged over the past 30 days. Rubrik reported earnings of $1.57 per share in the year-ago quarter.

Rubrik, Inc. Price and Consensus

Rubrik, Inc. price-consensus-chart | Rubrik, Inc. Quote

Rubrik currently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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