Core Insights - The presentation is part of Needham's Annual Growth Conference, featuring Nutanix's CFO Rukmini Sivaraman and Head of IR Rich Valera [1][2] Group 1 - The lead analyst covering infrastructure software and cybersecurity is Mike Cikos from Needham & Company [1] - The session will include a set of questions for a fireside chat format, with audience participation encouraged through Q&A [2] - The logistics of the event were addressed, expressing appreciation for the time given by Nutanix's representatives [2]

Nutanix Conference Call Summary Company Overview - **Company**: Nutanix - **Industry**: Infrastructure Software - **Revenue**: Approximately $2.5 billion to $3 billion annually [8] Key Points and Arguments Company Background - Nutanix is an infrastructure software company that provides a hyper-converged infrastructure (HCI) solution, which simplifies IT management by converging compute, networking, and storage into a single architecture [4][5] - The company has maintained a customer net promoter score (NPS) of over 90 for more than a decade, indicating high customer satisfaction [8] Market Dynamics - The HCI market is still growing, with opportunities to modernize legacy three-tier architectures [6] - Nutanix has expanded its portfolio to support applications running on public cloud, bare metal, and edge locations, as well as both virtual machine-based and containerized applications [7] Customer Adoption Challenges - Customer inertia and existing hardware depreciation cycles are significant barriers to adopting HCI solutions [11][13] - Some customers may delay adoption due to recent hardware investments, leading to timing issues in transitioning to Nutanix's solutions [13] External Storage Support - Nutanix has recently begun supporting external storage solutions, such as Dell PowerFlex and Pure Storage, to address customer needs and facilitate quicker migrations from legacy systems [14][18] - This decision was influenced by market changes, particularly Broadcom's acquisition of VMware, which forced customers to consider alternatives [19][20] Financial Performance and Guidance - In the most recent quarter, bookings exceeded expectations, but revenue was impacted by an increase in orders with future start dates, which delays revenue recognition [37][40] - The company has adjusted its full-year guidance to account for ongoing future start date dynamics and potential supply chain issues [41][42] AI and Product Development - Nutanix is in the early stages of deploying its AI solutions, including "GPT-in-a-Box," which allows customers to build and run AI applications efficiently [31][34] - The company believes it is well-positioned to support customers transitioning to cloud-native applications as they explore AI opportunities [34] Capital Allocation Strategy - Nutanix has initiated an accelerated share repurchase (ASR) program to take advantage of its strong balance sheet and current stock price dislocation [59][60] - The company is also open to acquisitions that align with its strategic goals, having previously acquired D2IQ to enhance its cloud-native capabilities [63] Renewal and New Logo Strategy - Nutanix has a dedicated renewals team to focus on maintaining existing customer relationships while also pursuing new logo acquisitions [55][56] - The company incentivizes sales teams to convert new logos, recognizing the additional effort required compared to expanding existing accounts [57][58] Additional Important Insights - The company is monitoring supply chain dynamics closely, particularly around memory and server prices, which could impact future operations [42][44] - Nutanix's approach to customer engagement emphasizes flexibility and responsiveness to customer needs, particularly in the context of transitioning from legacy systems to modern architectures [22][23]

Core Viewpoint - Nutanix, Inc. is under investigation for potential securities fraud and unlawful business practices following disappointing financial results and a significant stock price drop [1][2][3]. Financial Performance - On November 25, 2025, Nutanix reported Q1 fiscal year 2026 revenue at the lower end of its prior guidance, leading to a revised full-year revenue projection from $2.9 billion to $2.94 billion down to $2.82 billion to $2.86 billion [2]. - The revenue shortfall was attributed to a late quarter revenue shift due to increased customer demand for flexible start dates and growth through third-party OEM partners [2]. Stock Market Reaction - Following the announcement of the financial results, Nutanix's stock price fell by $10.43 per share, or 17.8%, closing at $48.34 per share on November 26, 2025 [3].

Core Viewpoint - The Schall Law Firm is investigating Nutanix, Inc. for potential violations of securities laws related to misleading statements and undisclosed information affecting investors [1][2]. Financial Performance - Nutanix reported Q1 2026 financial results on November 25, 2025, with revenue at the lower end of its prior guidance [2]. - The company attributed the revenue shortfall to a "revenue shift from Q1 to future periods" and customer demand for flexible start dates [2]. - Following the announcement, Nutanix's shares dropped by 17.8% the next day [2]. Legal Investigation - The investigation by the Schall Law Firm focuses on whether Nutanix misled investors regarding its financial performance and future projections [2]. - Shareholders who experienced losses are encouraged to participate in the investigation and can contact the Schall Law Firm for more information [3].

Group 1 - Nutanix Inc. (NASDAQ:NTNX) is recognized as one of the top software infrastructure stocks favored by hedge funds [1] - RBC Capital has reduced its price target for Nutanix from $74 to $65, indicating a shift in near-term momentum rather than a change in long-term outlook, as the stock retains an Outperform rating [1] - The company is identified as a leading candidate for potential mergers and acquisitions in the infrastructure, security, and analytics sectors, with M&A activity in the software space increasing over 50% year-to-date compared to the previous year [3] Group 2 - RBC anticipates that 2026 will showcase clear advantages for software companies that are well-positioned to benefit from enterprise AI adoption, while those perceived as vulnerable to the "AI is the death of software" narrative may struggle [2] - Management teams in the software sector are entering 2026 with conservative guidance, although enterprise spending trends are stabilizing and GenAI-driven innovations are enhancing various areas [2]

Core Insights - The article discusses the best software infrastructure stocks to buy according to hedge funds, highlighting the potential growth in the software application layer driven by AI infrastructure spending [1][4]. Industry Overview - An estimated $45 trillion opportunity may arise in the software application layer as AI infrastructure spending increases, similar to the early days of cloud computing [2]. - Data center investments are accelerating, with billions already invested, leading to a 9x multiplier for the implied enterprise value of software companies, which benefit from this spending [3]. Company Analysis - F5 Inc. (NASDAQ:FFIV) has a market cap of $15.6 billion and is held by 40 hedge funds. RBC Capital Markets upgraded its rating to Outperform with a price target increase to $325, indicating a 27% upside potential [8]. - F5's stock has declined by approximately 25% since mid-October 2025 due to a significant security breach, but RBC views this as a favorable entry point [11]. - Medium-term growth drivers for F5 include cloud repatriation, AI-driven workload monetization, and a focus on security solutions [12][13]. - Nutanix Inc. (NASDAQ:NTNX) has a market cap of $14.4 billion and is held by 47 hedge funds. RBC Capital lowered its price target to $65 but maintained an Outperform rating, indicating confidence in long-term growth despite near-term momentum concerns [14]. - RBC noted an increase in M&A activity in the software sector, with Nutanix identified as a leading candidate for acquisition in the infrastructure, security, and analytics space [16].

Core Viewpoint - Pomerantz LLP is investigating potential securities fraud or unlawful business practices involving Nutanix, Inc. and its officers or directors, following disappointing financial results and a significant stock price drop [1][3][4]. Financial Performance - On November 25, 2025, Nutanix reported first-quarter fiscal year 2026 revenue that was near the lower end of its prior guidance, attributing this to a late quarter revenue shift due to increased customer demand for flexible start dates and growth through third-party OEM partners [3]. - The company revised its full-year revenue projection down from a range of $2.9 billion to $2.94 billion to a new range of $2.82 billion to $2.86 billion [3]. Stock Market Reaction - Following the announcement of the financial results, Nutanix's stock price fell by $10.43 per share, representing a 17.8% decline, closing at $48.34 per share on November 26, 2025 [4].

Core Viewpoint - Bragar Eagel & Squire, P.C. is investigating potential claims against Nutanix, Inc. regarding possible violations of federal securities laws and unlawful business practices [1][2]. Group 1: Investigation Details - On November 25, 2025, Nutanix reported first quarter fiscal 2026 revenue results that were at the bottom end of its prior guidance, leading to a significant revenue projection cut for the full year from $2.9 billion - $2.94 billion to $2.82 billion - $2.86 billion [2]. - The decline in revenue was attributed to a late quarter revenue shift due to increased customer demand for flexible start dates and growth through third-party OEM partners [2]. - Following this announcement, Nutanix's share price fell by $10.43, or approximately 17.8%, from $58.77 to $48.34 [2]. Group 2: Next Steps - Investors who purchased or acquired Nutanix shares and experienced losses are encouraged to contact Bragar Eagel & Squire for more information regarding their rights and potential claims [3]. Group 3: About the Law Firm - Bragar Eagel & Squire, P.C. is a nationally recognized law firm with a focus on representing individual and institutional investors in various types of litigation, including securities and commercial cases [4]. - The firm operates nationwide and handles cases in both federal and state courts [4].

Core Viewpoint - Kirby McInerney LLP is investigating potential claims against Nutanix, Inc. regarding possible violations of federal securities laws or unlawful business practices by the Company or its senior management [1] Group 1 - Nutanix published its first quarter fiscal 2026 revenue results on November 25, 2025, after the market closed [1]

Core Viewpoint - Nutanix, Inc. has announced an accelerated share repurchase agreement to buy back $300 million of its common stock, reflecting confidence in its business and growth potential [1][2] Group 1: Share Repurchase Details - The accelerated share repurchase (ASR) will be funded with existing cash and is part of Nutanix's ongoing share repurchase authorization [1] - Nutanix has already repurchased $82.5 million of its common stock in the current fiscal year, bringing the total expected repurchase to approximately $382.5 million since the beginning of fiscal year 2026 [1] - Under the ASR agreement, Nutanix will pay $300 million to Bank of America and expects to receive about 4,972,032 shares, which represents 80% of the payment value [2] Group 2: Company Outlook and Strategy - The CEO of Nutanix emphasized the strong balance sheet, which allows the company to innovate, invest in the business, and provide returns to shareholders [2] - The final settlement of the ASR is anticipated to occur before the end of January 2026, with the total number of shares repurchased being based on the volume-weighted average price of Nutanix common stock during the ASR term [2] Group 3: Company Background - Nutanix is recognized as a leader in hybrid multicloud computing, providing a unified software platform for application management and data handling [4] - The company serves over 29,000 customers globally, aiding in digital transformation and efficient management of hybrid multicloud environments [4]