Financial Data and Key Metrics Changes - Subscription ARR reached $1.093 billion, growing 39% year over year, indicating strong performance in the cyber resilience market [7][34] - Subscription revenue was $244 million, up 54% year over year, contributing to total revenue growth of 47% year over year [10][39] - Free cash flow for Q4 was over $75 million, with a full fiscal year free cash flow of approximately $22 million, reflecting a significant improvement from the previous year [10][44] - Non-GAAP gross margin improved to 80% in Q4 from 78% in the previous year, benefiting from revenue outperformance and improved efficiency [41][42] Business Line Data and Key Metrics Changes - Net new subscription ARR reached over $90 million in Q4, a record for the company [8] - Customers with $100k or more in subscription ARR grew by 29% to 2,246, while those with $1 million or more increased by 64% to 162 [9][38] - Subscription ARR contribution margin improved by over 1,400 basis points year over year, indicating better operating leverage [9][43] Market Data and Key Metrics Changes - Revenue from the Americas grew 48% to $185 million, while revenue from outside the Americas increased by 47% to $73 million [40] - The company reported a strong demand for its offerings, particularly in the context of cloud transformation and generative AI [11][46] Company Strategy and Development Direction - The company aims to accelerate product innovation and lay the foundation for future growth, focusing on cyber resilience and data security [31][32] - Rubrik, Inc. is positioned at the intersection of data security and AI, with plans to prioritize product development and inorganic growth opportunities [61][63] - The company is expanding its capabilities to cover critical platforms across traditional and modern infrastructures, including support for Red Hat OpenShift and PostgreSQL databases [22] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the cyber resilience market and the company's ability to deliver strong subscription ARR growth [46] - The company anticipates higher net new subscription ARR in the second half of the fiscal year, aligning with typical seasonality [47] - Management noted that cyber resilience remains a top priority for customers, regardless of economic cycles, indicating sustained demand for their products [76] Other Important Information - The company has integrated its Global Data Security Posture Management (DSPM) into its security cloud, enhancing data visibility and control [19] - Regulatory requirements, such as the Digital Operational Resilience Act (DORA), are seen as tailwinds for the business, driving demand for compliance and resilience solutions [121] Q&A Session Summary Question: What is the outlook for the total addressable market (TAM) in data protection? - Management indicated that the TAM is expanding due to the need for modern data protection tools as customers transition to cloud and generative AI [59][61] Question: What are the evolving requirements from leading-edge customers? - Management emphasized the focus on cyber resilience, data security, and identity-related threats as key areas for future development [70][72] Question: Can you elaborate on the substantial improvement in subscription ARR contribution margin? - Management highlighted that improved sales efficiency and larger deal sizes contributed significantly to the margin improvement [81][88] Question: What is driving the divergence between revenue growth and ARR growth? - Management explained that the company is in the midst of a cloud transformation, which has led to temporary discrepancies between revenue and ARR growth rates [100][102] Question: Why is the company moving to annual compensation plans for sales? - Management stated that annual plans align better with the business model and incentivize long-term performance [108][110] Question: What are the expectations regarding DSPM adoption? - Management noted that DSPM is still an early market, but awareness is growing, and the integration with cyber recovery enhances the value proposition [140][141]
Rubrik, Inc.(RBRK) - 2025 Q4 - Earnings Call Transcript