Commvault(US:CVLT)2024-04-30 18:51Financial Data and Key Metrics Changes - Total revenue increased by 10% to $223 million in Q4, driven by a 27% increase in subscription revenue, which now exceeds 50% of total revenue [6][17] - Total Annual Recurring Revenue (ARR) rose by 15% to $770 million, with subscription ARR growing by 25% to nearly $600 million [6][9] - SaaS ARR jumped by 65% to $168 million, with over 5,000 SaaS customers acquired profitably [6][9] - Fiscal Q4 gross margins were 83.2%, reflecting a 30 basis point increase sequentially [11] - Non-GAAP EBIT for Q4 was $45 million, with non-GAAP EBIT margins at 20.2% [12] Business Line Data and Key Metrics Changes - Subscription revenue for fiscal year '24 increased by 23% to $429 million, with operating expenses at 61% of total revenue, down from 62% the previous year [30] - Customer support revenue from term software and related arrangements accelerated to 47% of total customer support, compared to 40% in fiscal year '23 [20] - New SaaS ARR contributed two-thirds of total ARR growth for the full fiscal year [10] Market Data and Key Metrics Changes - The Americas and International regions posted strong performance, with double-digit term software growth [18] - The Americas region had its best new customer acquisition quarter of the year, indicating strong traction in the enterprise market [18] Company Strategy and Development Direction - The company aims to accelerate total revenue growth while generating strong free cash flows, with a projected total revenue growth of 8% for fiscal year '25 [14][33] - The focus is on enhancing the cyber resilience platform, which integrates security and recovery capabilities, appealing to both security and IT infrastructure organizations [74][81] - The company expects to reach total ARR of $1 billion by the end of fiscal year '26, with subscription ARR representing 90% of total ARR [34] Management's Comments on Operating Environment and Future Outlook - Management highlighted the increasing pressure on organizations to recover quickly from cyberattacks, emphasizing the importance of their cyber resilience platform [42][46] - The company is optimistic about the future, citing strong demand for their offerings and the successful integration of recent acquisitions [45][49] Other Important Information - The company returned $184 million to shareholders as part of its share repurchase program, representing 92% of free cash flow [13] - The projected diluted share count for fiscal Q1 is approximately 45 million shares [14] Q&A Session Summary Question: How much of the additional investments are on the indirect channel side? - Management indicated that a good portion of the investments is related to events and partnerships, particularly with hyperscalers and security partners [29] Question: Can you characterize the renewal opportunity relative to new subscription growth? - Management expressed confidence in balanced contributions from both renewal and new subscription growth, with incremental renewal tailwinds expected [36][37] Question: What is the expected ASP uplift from cyber resilience deals? - Management did not provide specific figures but indicated that the pipeline is building and customers are gravitating towards cyber resilience capabilities [88][85]