Core Insights - Commvault is showcasing its cyber resilience and recovery solutions at Microsoft Ignite, emphasizing its leadership in unified resilience at enterprise scale [1] - The company is participating in discussions on improving organizational readiness for cyberattacks, highlighting actionable strategies for recovery [2] - Commvault is offering product demonstrations of its complete cyber resilience platform, including features like Cloud Rewind and Air Gap Protect [3] - The SHIFT Virtual 2025 event will feature insights from Commvault executives on AI trends and the company's latest offerings [4] Company Overview - Commvault is recognized as a leader in unified resilience at enterprise scale, focusing on data security, identity resilience, and cyber recovery on a cloud-native, AI-enabled platform [4] - The company aims to enable organizations to safely adopt AI while protecting against AI-driven threats, ensuring comprehensive recovery capabilities [4]

Joining me now in a CNBC exclusive, Convault CEO Sanjay Merchandonni. Sanjay, I want to talk to you about your news today and your outlook for 2026. But first, we haven't spoken on air since earnings.So, uh, tell us about this shift in term duration. What's happening beneath the surface with your subscription revenues. >> Hey, John.Yeah, we haven't spoken in a few weeks, but um you know what what what what is happening essentially is that we had a bit of a mix shift between our term license or software and ...

Core Insights - Commvault announced an expansion of its Identity Resilience portfolio, enhancing capabilities to detect threats in Active Directory (AD), log malicious changes, and roll back to a trusted state [1][4][11] - The integration of Commvault's AD forest recovery with Cleanroom Recovery allows for isolated recovery testing without disrupting production systems [5][6][7] Identity Resilience Enhancements - The new advancements enable enterprises to identify hard-to-detect threats in AD, maintain an audit trail of changes, and reverse unwanted modifications in real time [9][11] - Commvault's solutions address the significant risk posed by AD, which is targeted in 90% of attacks due to its control over access to critical business operations [3][5] Integration with Cleanroom Recovery - The integration allows customers to recover AD forests in a cleanroom environment, facilitating preemptive testing of recovery plans [6][7] - This approach minimizes disruption to identity systems while ensuring readiness for potential attacks [5][6] Overall Impact - Commvault's end-to-end Identity Resilience portfolio aims to provide comprehensive protection and recovery solutions, reducing total cost of ownership (TCO) for customers [7][11] - The advancements will be available for early access in early 2026, following their introduction at SHIFT 2025 [8][11]

Financial Data and Key Metrics Changes - Total ARR for the third quarter was $528.1 million, reflecting a 14% year-over-year growth on a reported basis and 13% on a constant currency basis [29] - Total revenue reached $131.7 million, exceeding guidance by $3.7 million, representing approximately 13% year-over-year growth on a reported basis and 12% on a constant currency basis [29] - Adjusted EBITDA margin was approximately 31.4%, with adjusted EBITDA of $41.4 million, which was $4.4 million above the high end of guidance [30] - Dollar-based net revenue retention was approximately 102% on a reported basis, indicating improvement year-over-year and quarter-over-quarter [30][25] Business Line Data and Key Metrics Changes - The data protection solution led net new ARR growth in the quarter, showcasing strong demand for security operations and unified endpoint management (UEM) [20][25] - The company launched anomaly detection as a service, enhancing its data protection capabilities and shifting focus from reactive defense to proactive resilience [19] Market Data and Key Metrics Changes - Approximately 45% of revenue was generated outside of North America, indicating a diversified market presence [31] - The company reported a significant increase in detected threats against small and mid-market businesses, highlighting the growing need for cybersecurity solutions [8] Company Strategy and Development Direction - The company is focused on driving security success, scaling its go-to-market strategy, and boosting customer expansion, with a channel-first model proving effective [19][21] - N-able is embedding AI capabilities across its platform to enhance cybersecurity solutions, positioning itself as a leader in the evolving cybersecurity landscape [10][17] - The company aims to democratize security by providing advanced AI SOC capabilities at a fraction of the cost, targeting small and mid-market businesses [15] Management's Comments on Operating Environment and Future Outlook - Management emphasized the critical role of AI in driving demand for cybersecurity solutions and the importance of embedding AI into their platform [10][26] - The outlook for the fourth quarter includes expected total revenue in the range of $126.5-$127.5 million, representing approximately 9% year-over-year growth [33] - The company raised its full-year ARR outlook to $530-$531 million, reflecting a commitment to balancing profitability with growth [34] Other Important Information - The company executed a share repurchase program, demonstrating confidence in its long-term value [26] - N-able's recent initiatives, such as sponsoring CATNIP, aim to standardize AI language across organizations, enhancing automation and efficiency [11] Q&A Session Summary Question: What are the keys behind the building momentum in ARR revenue? - Management attributed the acceleration to successful execution around the Adlumen acquisition and broadening channel presence [39][46] Question: How confident is management that net revenue retention has bottomed? - Management expressed high confidence that net revenue retention bottomed in the first quarter and has been improving due to successful cross-selling and gross retention efforts [49][50] Question: How is the Adlumen acquisition performing relative to initial expectations? - Management indicated that the acquisition thesis is holding true, with strong demand and successful scaling within the MSP community [70][71] Question: What is the company's approach to investing in AI? - Management confirmed ongoing investments in AI, viewing it as a significant opportunity for both short-term and mid-term growth, while maintaining a focus on achieving 30% EBITDA margins [76][80]

Financial Performance & Growth - N-able's Annual Recurring Revenue (ARR) reached $528 million as of September 30, 2025[8] - The company achieved a Net Retention Rate of 102% (TTM)[8] - N-able experienced 14% ARR growth[8] - The Non-GAAP Adjusted EBITDA Margin (TTM) was 31%[8] - The Non-GAAP Gross Margin (TTM) was 81%[8] - The company projects full-year 2025 revenue between $507.7 million and $508.7 million, representing a 9% year-over-year growth (8% at constant currency)[62] - The company projects full-year 2025 Adjusted EBITDA between $148.2 million and $149.2 million, with a 29% margin[62] Market Opportunity & Strategy - The Small and Mid-market IT Total Addressable Market (TAM) is estimated at $2.1 trillion in 2025[13] - N-able estimates its total TAM across Unified Endpoint Management (UEM), Data Protection, and Security Operations at $44 billion[22] - N-able sees a cross-sell opportunity of over $2.5 billion across its product lines[52]

Core Insights - Veeam App for Microsoft Sentinel enhances cyber resilience by providing organizations with real-time backup intelligence and automated threat response [1] Company Summary - The Veeam App for Microsoft Sentinel is designed to empower organizations in managing their backup processes effectively [1] - The application focuses on improving cyber resilience through advanced features that facilitate real-time monitoring and automated responses to threats [1] Industry Summary - The integration of backup intelligence and threat response automation is becoming increasingly critical in the cybersecurity landscape [1] - Organizations are seeking solutions that not only protect data but also enhance their ability to respond to cyber threats in real-time [1]

Core Insights - Commvault has launched Data Rooms, a secure environment for enterprises to connect trusted backup data to AI platforms, facilitating the transformation of backup data into AI-ready assets without increasing risk or complexity [1][4][5] Group 1: Product Offering - Data Rooms provide governed, self-service access to backup data, enabling authorized users to locate and prepare data from both on-premises and cloud environments [4][5] - The offering includes built-in governance features such as classification, sensitivity tagging, and audit trails, ensuring that data remains protected and compliant [4][9] - Data Rooms operate within a zero-trust architecture, utilizing role-based access controls and encryption to safeguard data during access and transit [4][5] Group 2: Market Context - As organizations accelerate AI adoption, many face challenges in making their data accessible and trustworthy, with nearly 75% of IT leaders expressing concerns about increased vulnerability to cyberattacks due to AI [2][5] - The traditional ETL workflow for data preparation is time-consuming and can introduce compliance risks, highlighting the need for solutions like Data Rooms [2][3] Group 3: Strategic Importance - Enterprises are recognizing the value of historical data as a strategic asset, and Commvault's Data Rooms enable them to harness this data for AI initiatives, unlocking new opportunities for innovation and growth [7][9] - The offering aims to bridge the gap between data protection and data activation, allowing organizations to operationalize AI more effectively [5][9] Group 4: Availability and Future Plans - Commvault Data Rooms are currently in early access, with general availability expected in early 2026, and pricing details to be announced at that time [8]

Financial Data and Key Metrics Changes - Commvault achieved a total revenue growth of 18% to $276 million, with subscription ARR increasing by 30% to $894 million [4][15] - Total ARR grew by 22% to exceed $1 billion, reaching this milestone two quarters earlier than the original target [4][14] - SaaS ARR rose 56% to $336 million, also surpassing the initial target two quarters ahead of schedule [15][20] Business Line Data and Key Metrics Changes - Subscription ARR now constitutes 86% of total ARR, up from 81% a year ago, indicating a strong shift towards subscription-based revenue [15] - Identity and data security-focused offerings contributed nearly 40% of net new ARR, showcasing strong momentum in this segment [7][16] - Active Directory usage tripled year over year, reflecting increased adoption of data and identity recovery solutions [16] Market Data and Key Metrics Changes - The number of SaaS customers grew to nearly 9,000, representing a 40% year-over-year increase [9] - Commvault moved and protects approximately eight exabytes of customer data in the cloud, with a CAGR of over 40% over the past five years [8] - Net dollar retention remained healthy at 125%, indicating strong customer loyalty and upsell opportunities [10] Company Strategy and Development Direction - Commvault's growth is driven by strong demand for its Cloud Cyber Resilience platform, the ongoing shift to the cloud, and a commitment to innovation [5][10] - The company is focusing on integrating identity security with data protection to enhance cyber resilience [38] - Recent acquisition of Satori Cyber aims to bolster capabilities in monitoring and protecting large language models and structured data [11] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued market demand, driven by the need for enhanced cyber resilience amid rising cyber threats [36][23] - The company anticipates a total ARR growth of 18% to 19% for fiscal 2026, with subscription ARR expected to increase by 24% to 25% [21][22] - Management highlighted the importance of innovation and customer-centric strategies to maintain competitive advantage in a rapidly evolving market [47] Other Important Information - Commvault's fiscal Q2 gross margins were reported at 80.5%, reflecting the impact of the SaaS business mix [18] - The company raised $900 million in convertible senior notes to optimize its balance sheet and enhance capital allocation flexibility [19] - Free cash flow grew 37% year over year to $74 million, supported by strong cash collections and deferred revenue from SaaS contracts [19] Q&A Session Summary Question: Can you elaborate on the shift in term duration? - Management noted that customers are opting for shorter contract durations to maintain flexibility as they transition to the cloud, which has impacted average deal size [26] Question: How does Commvault view the competitive landscape? - Management believes that while the market is competitive, Commvault is gaining share due to its innovative solutions and strong growth in both SaaS and software segments [31][33] Question: Is the backup modernization cycle winding down? - Management disagreed, stating that the frequency and scale of cyber attacks continue to drive demand for modernization and resilience solutions [36] Question: What are the drivers of the term subscription business? - On-premise data growth remains a significant driver, alongside the increasing integration of identity and data security offerings [52] Question: Are you seeing increased cross-sell between term and SaaS customers? - Management confirmed that the percentage of SaaS customers also using term products is gradually increasing, reflecting a positive trend in cross-selling [55]

Financial Data and Key Metrics Changes - Commvault achieved a record $47 million in net new ARR, with subscription ARR rising 30% to $894 million and total revenue growing 18% to $276 million [3][12] - Total ARR grew 22%, reaching $1 billion two quarters earlier than the original target [3][12] - SaaS ARR grew 56% to $336 million, also exceeding the original target two quarters ahead of schedule [12][13] - Fiscal Q2 gross margins were 80.5%, reflecting the shift towards SaaS and the integration costs from Satori [17][66] Business Line Data and Key Metrics Changes - Subscription ARR now constitutes 86% of total ARR, up from 81% a year ago [13] - Strong double-digit growth was observed in identity and data security offerings, which represented nearly 40% of net new ARR [5][15] - Active Directory usage tripled year over year, indicating strong demand for identity protection services [15][46] Market Data and Key Metrics Changes - Commvault protects approximately eight exabytes of customer data in the cloud, with a CAGR of over 40% over the past five years [7] - The number of SaaS customers grew to nearly 9,000, representing a 40% increase year over year [8] - Net dollar retention remained healthy at 125%, indicating strong adoption of SaaS offerings from existing customers [9][15] Company Strategy and Development Direction - The company focuses on three key growth drivers: demand for the Commvault Cloud Cyber Resilience platform, the shift to the cloud, and ongoing innovation [4][10] - Commvault aims to address evolving resilience requirements as enterprises increasingly adopt AI technologies [10] - The acquisition of Satori Cyber is expected to enhance the company's capabilities in monitoring and protecting large language models [10] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued strong market demand, driven by innovation and growth-focused investments [21] - The competitive landscape remains challenging, but Commvault is positioned to take market share through its innovative platform [28][39] - The company anticipates a total revenue range of $1.161 to $1.165 billion for fiscal year 2026, reflecting a 17% increase at the midpoint [20] Other Important Information - Commvault's capital allocation strategy includes share buybacks, M&A, and organic investments [72] - The company repurchased $131 million of stock during the quarter, with a total of $146 million year to date [18][72] Q&A Session Summary Question: Can you elaborate on the shift in term duration? - Management noted that customers are opting for shorter contract durations to maintain flexibility as they transition to the cloud, which has impacted average deal size [24][62] Question: How does Commvault view the competitive landscape? - Management indicated that while the landscape is competitive, Commvault continues to take market share, particularly in the SaaS segment, which is growing at a faster rate than the overall market [28][30] Question: Are there signs of a slowdown in backup modernization? - Management disagreed, stating that the demand for cyber resilience remains strong due to ongoing cyber threats and the need for innovative solutions [31] Question: What are the drivers of the term subscription business? - Management highlighted that on-premise data growth continues to be a significant driver, alongside the increasing importance of identity and data security [43][46] Question: Is there increased cross-sell between term and SaaS customers? - Management confirmed that the percentage of SaaS customers also using term services is gradually increasing, reflecting a positive trend in cross-selling [47][48]

Regulatory Priorities - ESMA Chair Verena Ross discussed the organization's priorities and expanding responsibilities [1] - Focus areas include SIU (Supervisory Convergence, Investment Management and Innovation), fund markets, cyber resilience, Sustainable Finance EU, and innovation in finance [1]