CommVault Systems (NASDAQ:CVLT) Posts Quarterly Earnings Results, Beats Estimates By $0.13 EPS

CommVault Systems (NASDAQ:CVLT) issued its quarterly earnings data on Tuesday. The software maker reported $1.38 earnings per share for the quarter, beating analysts’ consensus estimates of $1.25 by $0.13, FiscalAI reports. The company had revenue of $312.39 million for the quarter, compared to the consensus estimate of $310.41 million. The firm’s revenue for the quarter was up 13.1% on a year-over-year basis. During the same quarter last year, the company earned $0.91 EPS.

Here are the key takeaways from CommVault Systems’ conference call:

• Strong Q2 execution drove subscription ARR up 20% to $1.104 billion, SaaS ARR up 35% to $454 million, and free cash flow of $71 million. Management raised full-year guidance for subscription ARR, subscription revenue, EBIT margin, and free cash flow.
• SaaS and platform expansion remain key growth drivers, with 53% of managed SaaS customers using at least two products versus roughly 45% a year ago. Identity resilience ARR nearly doubled year over year, while cloud-centric offerings grew rapidly and contributed to cross-sell momentum.
• Profitability improved as gross margin expanded to 81.6% and non-GAAP EBIT margin rose 330 basis points to 21.9%; the company also repurchased approximately $109 million of stock. Management expects full-year free cash flow of $255 million to $265 million and plans to return at least 60% of annual free cash flow to shareholders.
• Management sees AI deployments, identity proliferation, and enterprise platform consolidation as long-term tailwinds, but acknowledged that AI-related protection budgets and demand are still in the early stages. Subscription net dollar retention was 113%, within its stated range but reflecting relatively greater contribution from new customers than expansion.
• Total revenue growth is being constrained by the strategic decline of legacy perpetual software and maintenance revenue streams, with full-year total revenue guidance of $1.30 billion to $1.31 billion despite stronger subscription trends.

CommVault Systems Stock Performance

CVLT stock opened at $172.55 on Wednesday. The firm has a fifty day moving average price of $146.25 and a 200 day moving average price of $118.53. CommVault Systems has a fifty-two week low of $71.75 and a fifty-two week high of $174.25. The firm has a market cap of $7.15 billion, a PE ratio of 109.90 and a beta of 0.79.

Analyst Ratings Changes

Several research analysts have recently commented on the company. Weiss Ratings reaffirmed a “hold (c)” rating on shares of CommVault Systems in a research note on Friday, September 11th. KeyCorp boosted their price objective on CommVault Systems from $125.00 to $175.00 and gave the company an “overweight” rating in a research note on Thursday, July 16th. DA Davidson set a $175.00 price objective on CommVault Systems in a research note on Wednesday, July 29th. Truist Financial increased their target price on shares of CommVault Systems from $155.00 to $182.00 and gave the stock a “buy” rating in a report on Tuesday, July 21st. Finally, Cantor Fitzgerald raised their target price on shares of CommVault Systems from $132.00 to $171.00 and gave the stock a “neutral” rating in a research note on Monday. One research analyst has rated the stock with a Strong Buy rating, ten have assigned a Buy rating and ten have given a Hold rating to the stock. Based on data from MarketBeat.com, the stock presently has an average rating of “Moderate Buy” and an average target price of $163.19.

More CommVault Systems News

Here are the key news stories impacting CommVault Systems this week:

• Positive Sentiment: Commvault reported fiscal Q2 earnings of $1.38 per share, above the $1.25 analyst consensus, while revenue of $312.39 million exceeded estimates of $310.41 million. Revenue increased 13.1% year over year, and earnings rose from $0.91 per share in the prior-year quarter. Commvault Systems Beats Q2 Earnings and Revenue Estimates
• Positive Sentiment: The company’s subscription revenue climbed 21% to $269 million, while annualized recurring revenue reached $1.104 billion, up 20% year over year. Operating cash flow of $75 million and free cash flow of $71 million further strengthen the growth and cash-generation story. Commvault Announces Second Quarter Fiscal 2027 Financial Results
• Positive Sentiment: The earnings performance has prompted coverage describing the results as stronger than the stock’s initial reaction, potentially reinforcing the case for continued investor interest in CVLT. Commvault Q2 Earnings Power Upends a Modest Stock Reaction
• Neutral Sentiment: Jefferies raised its price target from $130 to $170 but maintained a Hold rating. The increase reflects improved expectations, but the target is slightly below the stock’s recent trading level. CommVault Stock Price Expected to Rise, Jefferies Analyst Says
• Negative Sentiment: Valuation remains a risk: CVLT’s price-to-earnings ratio is above 100, while Jefferies and Cantor Fitzgerald have targets of $170 and $171, respectively, both below the recent share price. Their Hold and Neutral ratings could temper enthusiasm after the earnings rally.

Insider Transactions at CommVault Systems

In related news, Director Vivie Lee sold 595 shares of CommVault Systems stock in a transaction dated Monday, August 10th. The shares were sold at an average price of $134.19, for a total transaction of $79,843.05. Following the completion of the transaction, the director directly owned 15,140 shares of the company’s stock, valued at approximately $2,031,636.60. The trade was a 3.78% decrease in their position. The transaction was disclosed in a document filed with the Securities & Exchange Commission, which is accessible through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. Also, CFO Gary Merrill sold 1,293 shares of the firm’s stock in a transaction that occurred on Wednesday, August 19th. The stock was sold at an average price of $142.80, for a total value of $184,640.40. Following the sale, the chief financial officer directly owned 69,628 shares of the company’s stock, valued at $9,942,878.40. This represents a 1.82% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Over the last 90 days, insiders sold 29,348 shares of company stock worth $4,202,441. 0.86% of the stock is currently owned by corporate insiders.

CommVault Systems Company Profile

Commvault Systems, Inc develops data protection and cyber resilience software and services for businesses, government organizations and other institutions. Its platform is designed to help customers back up, recover, manage and secure data across on-premises infrastructure, private and public clouds, software-as-a-service applications and other distributed IT environments.

The company’s offerings include backup and recovery, disaster recovery, data security, ransomware protection, cyber-recovery capabilities and data management tools.