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Commvault (CVLT) Q4 FY26 earnings call: guidance and Q&A

Earnings call· Mar 2026 (Q4 FY26)· Information Technology· Apr 28, 2026

Source: earnings call transcript

Executive summary

Commvault Q4 FY26 — Strong ARR Growth and Record Free Cash Flow

Commvault concluded Q4 FY26 with robust subscription ARR growth and record free cash flow, driven by strong SaaS performance and multiproduct adoption. The company is leveraging its unified platform to address increasing data complexity and cyber threats, positioning itself for continued growth in the AI era. New financial reporting for FY27 emphasizes key subscription metrics and margin expansion.

Highlights

5

  • Subscription ARR increased 27% year-over-year to $989 million.

  • SaaS business ARR grew 42% year-over-year to reach $400 million.

  • Generated a record free cash flow of $132 million in Q4, contributing to $237 million for the fiscal year, up 16% year-over-year.

  • SaaS net dollar retention improved to 122%.

  • Identity resilience and data security offerings represented 33% of net new ARR in Q4.

Concerns

3

  • Macro Headwinds

  • Memory and Component Pricing

  • Competitive Market

Guidance & targets

CategoryTargetConfidence
Subscription ARR growth
18% to 19% year-over-year
high materiality
High
Subscription ARR
$1.20 billion to $1.21 billion
high materiality
High
SaaS ARR
exceed $0.5 billion
high materiality
High
Subscription Revenue
$1.115 billion to $1.125 billion
high materiality
High
Subscription Revenue growth
approximately 15% year-over-year
high materiality
High
Total Revenue
$1.30 billion to $1.31 billion
medium materiality
High
Non-GAAP EBIT margin
20.5%
high materiality
High
Free Cash Flows
$250 million to $260 million
high materiality
High
Diluted Share Count
approximately 42 million shares
medium materiality
High
Subscription Revenue
$263 million to $265 million
medium materiality
High
Subscription Revenue growth
approximately 15% year-over-year
medium materiality
High
Total Revenue
approximately $310 million
medium materiality
High
EBIT margins
approximately 19%
medium materiality
High
Diluted Share Count
approximately 42 million shares
medium materiality
High
Share Repurchase Authorization
$250 million
high materiality
High
Share Repurchase Allocation
approximately 60% of annual free cash flow
high materiality
High

Segment performance

SegmentRevenueYoYQoQMargin
Subscription
Led by robust SaaS growth.
ARR: $989M
$208M20%——
SaaS
Major milestone reached in ARR, reflecting new customer growth and healthy expansion from existing customers. Multiproduct adoption increased by 500 basis points year-over-year.
ARR: $400MCustomers using >1 offering: 48%
$93M43%——
Pure Software License
Growth against a challenging comparison, driven by strong renewals and existing customer business.
—6%——

CVLT operating KPIs by quarter

CVLT operating KPIs stated on its earnings calls, by fiscal quarter
KPIThis call Mar 2026 Q4 FY26 Jun 2026 Q1 FY27Change vs prior quarter
Annual recurring revenue (ARR) Subscription
$989M In the fourth quarter, subscription ARR increased 27% to $989 million. Source: earnings call transcript
$1.05B A few highlights include: subscription ARR grew 22% to $1.05 billion. Source: earnings call transcript
+6.2%
Annual recurring revenue (ARR) SaaS
$400M This was led by another quarter of strong growth from our SaaS business, which grew 42% to reach $400 million in ARR milestone for Commvault -- subscription revenue grew 20% to $208 million, and we generated a record free cash flow of $132 million in Q4, resulting in $237 million for the fiscal year. Source: earnings call transcript
$424M Our SaaS business fueled this growth growing 38% to $424 million in ARR. Source: earnings call transcript
+6%

Operating figures the company stated on at least two of the calls shown, checked against each call's transcript. Click a figure to read the sentence. A dash means it was not stated that quarter.

Product announcements

ProductTypeDetails
Satoriupdate
Data Activate and AI Studiolaunch
Glumio platform for Google Cloudexpansion

Deals & partnerships

Satori Acquisition of a data security company.

Satori acquisition is now fully integrated into the Commvault Cloud, enhancing data security capabilities.

Major storage providers Technical partnerships for supply and technical alignment.

Commvault maintains strong relationships and broad technical partnerships with major storage providers to navigate supply chain and technical alignment challenges.

Hyperscalers (Google, Amazon AWS) Strategic partnerships for cloud and multi-cloud deployments.

Pivotal relationships with hyperscalers, including deep integrations into marketplaces and evolving platform support for cloud-native offerings and AI agent frameworks.

Risks & headwinds

Macro Headwinds Current

Discussed, not quantified.

Mitigation:Current trends are baked into guidance; managed through pipeline, platform flexibility, technical partnerships, and SaaS platform.

Memory and Component Pricing Current

Discussed, not quantified.

Mitigation:Navigated through broad technical partnerships, helping customers 'sweat the assets' longer, and leveraging the SaaS platform for workload migration.

Competitive Market Ongoing

Discussed, not quantified.

Mitigation:No significant change in discounting trends; focus on hybrid approach and resilience budget as a priority.

What to watch in Q1 FY27

Subscription ARR Growth

FY27
Current 27% YoY ($989M)
Target 18% to 19% YoY ($1.20B-$1.21B)

Why it matters

This is a key North Star metric for the company, indicating the overall health and growth trajectory of its subscription business.

For the full fiscal year 2027, we expect subscription ARR growth of 18% to 19% year-over-year, representing a range of $1.20 billion to $1.21 billion.

Find out whether CVLT delivers this. Inve re-checks your case every morning.

Q&A highlights

What is the high-level FY27 sales compensation structure and what behaviors is it designed to drive, especially regarding multiproduct sales?

The FY27 compensation plan is geared towards new customer acquisition and cross-sell/platform expansion in the hybrid environment. The company aims to build on the progress of multiproduct expansion, especially with SaaS customers, where 48% now license at least two products.

“The first is new customer acquisition. And the second is cross-sell. So platform expansion in our hybrid environment.”

asked by Todd Weller · answered by Gary Merrill

2 min read 6 chapters

Detailed narrative

AI as a Powerful Tailwind

Commvault views AI as a significant tailwind, driving increased data, complexity, and risk, which directly elevates the demand for data protection, governance, and trusted recovery solutions. The company positions itself as providing the 'picks and shovels' for customers to adopt AI securely and responsibly. This includes protecting AI datasets and workloads, leveraging AI for faster threat detection and recovery at scale, automating resilience operations, and bringing governance to AI data.

Commvault Cloud Platform and Consolidation Trend

The Commvault Cloud unifies data protection, data security, identity resilience, and recovery on a single scalable control plane. This integrated platform is driving customer consolidation, as enterprises seek to move away from fragmented tools and standardize on a unified solution. This trend is evidenced by the growth across Commvault's business and increased multiproduct adoption among its SaaS customers.

Key Growth Drivers and Multiproduct Adoption

Commvault's growth is fueled by three main drivers: adding new subscription customers (over 2,500 in FY26, with ~600 in Q4), expanding multiproduct adoption, particularly within its SaaS base (48% of SaaS customers now use more than one offering, a 500 basis point improvement YoY), and strong momentum in emerging revenue streams like identity resilience. Identity resilience and data security offerings collectively represented 33% of net new ARR in Q4.

Identity Resilience Momentum

Identity resilience is highlighted as a rapidly growing area, with Active Directory protection being one of the fastest-growing SaaS offerings, doubling its ARR year-over-year. This solution helps customers significantly reduce recovery times, for example, from two days to under 90 minutes for a Fortune 500 retailer. The company continues to focus on innovation in this area as identity threats evolve.

New Financial Reporting Structure

Effective Q1 FY27, Commvault is transitioning to a new financial reporting framework. This involves recasting revenue and ARR classifications to align term software-related support revenue with subscription revenue, and presenting perpetual support revenue separately. The company will streamline its key guided metrics to focus on subscription ARR, free cash flow, subscription revenue, and non-GAAP EBIT, and will report subscription net dollar retention on an annualized basis.

Navigating Macro and Supply Chain Challenges

Management acknowledges macro headwinds and challenges related to memory and component pricing. These factors are incorporated into the FY27 guidance. Commvault mitigates these challenges through strong technical partnerships with major storage providers, enabling customers to 'sweat their assets' longer, and by leveraging its flexible SaaS platform to migrate workloads, ensuring project continuity regardless of broader economic or supply chain issues.

Summary of the company's earnings call; see how call summaries are prepared. Not investment advice.