Commvault Systems (NASDAQ:CVLT) reported first-quarter fiscal 2027 results that exceeded analyst expectations, although the cyber resilience software company’s shares fell more than 3% in pre-market trading as investors focused on its forward guidance.
The company delivered double-digit revenue growth, record subscription revenue and continued expansion in its software-as-a-service business.
Revenue and Profit Exceed Expectations
Commvault reported adjusted earnings per share of $1.42, comfortably ahead of the analyst consensus estimate of $1.16.
Revenue increased 11% year over year to $314.1 million, surpassing market expectations of $310.48 million.
Subscription revenue reached a record $267 million, representing annual growth of 16%, while subscription annualised recurring revenue (ARR) climbed 22% to $1.054 billion.
The company’s SaaS business also reached a significant milestone, with revenue exceeding $100 million for the first time after growing 39% from the previous year.
“Our results reflect what we’re hearing from customers every day – they are embracing our AI-enabled platform to protect data, govern access, and make clean, trusted recoveries,” said Sanjay Mirchandani, President and CEO.
Outlook Weighs on Investor Sentiment
For the second quarter of fiscal 2027, Commvault expects subscription revenue of between $264 million and $268 million, implying a midpoint of $266 million.
The company also forecast a non-GAAP EBIT margin of approximately 20% for the quarter.
For the full fiscal year, management expects subscription revenue to range between $1.119 billion and $1.129 billion, while subscription ARR is projected to reach between $1.20 billion and $1.21 billion.
Free cash flow for the year is expected to be between $250 million and $260 million.
Cash Generation Improves and Microsoft Partnership Expands
Free cash flow increased 71% year over year to $51 million during the quarter.
Commvault also reported non-GAAP EBIT of $71 million, delivering an operating margin of 22.8%.
Separately, the company announced a multi-year strategic partnership with Microsoft that will make its AI-powered cyber resilience solutions available as a native independent software vendor (ISV) service on Microsoft Azure.
Commvault Systems stock price
