CommVault Systems (NASDAQ:CVLT) Issues Quarterly Earnings Results

CommVault Systems (NASDAQ:CVLT) announced its quarterly earnings results on Tuesday. The software maker reported $1.38 earnings per share (EPS) for the quarter, beating the consensus estimate of $1.25 by $0.13, FiscalAI reports. CommVault Systems had a return on equity of 88.75% and a net margin of 5.62%. The business had revenue of $312.39 million during the quarter, compared to analyst estimates of $310.41 million. During the same period in the previous year, the company earned $0.91 EPS. The firm’s revenue was up 13.1% on a year-over-year basis.

Here are the key takeaways from CommVault Systems’ conference call:

• Strong Q2 execution drove subscription ARR up 20% to $1.104 billion, SaaS ARR up 35% to $454 million, and free cash flow of $71 million. Management raised full-year guidance for subscription ARR, subscription revenue, EBIT margin, and free cash flow.
• SaaS and platform expansion remain key growth drivers, with 53% of managed SaaS customers using at least two products versus roughly 45% a year ago. Identity resilience ARR nearly doubled year over year, while cloud-centric offerings grew rapidly and contributed to cross-sell momentum.
• Profitability improved as gross margin expanded to 81.6% and non-GAAP EBIT margin rose 330 basis points to 21.9%; the company also repurchased approximately $109 million of stock. Management expects full-year free cash flow of $255 million to $265 million and plans to return at least 60% of annual free cash flow to shareholders.
• Management sees AI deployments, identity proliferation, and enterprise platform consolidation as long-term tailwinds, but acknowledged that AI-related protection budgets and demand are still in the early stages. Subscription net dollar retention was 113%, within its stated range but reflecting relatively greater contribution from new customers than expansion.
• Total revenue growth is being constrained by the strategic decline of legacy perpetual software and maintenance revenue streams, with full-year total revenue guidance of $1.30 billion to $1.31 billion despite stronger subscription trends.

CommVault Systems Price Performance

CommVault Systems stock opened at $166.46 on Thursday. The business’s 50 day simple moving average is $146.72 and its 200 day simple moving average is $118.75. The company has a current ratio of 2.04, a quick ratio of 2.04 and a debt-to-equity ratio of 16.94. CommVault Systems has a 12 month low of $71.75 and a 12 month high of $174.25. The company has a market cap of $6.90 billion, a price-to-earnings ratio of 106.03 and a beta of 0.79.

Analyst Ratings Changes

Several brokerages have recently commented on CVLT. FBN Securities assumed coverage on shares of CommVault Systems in a report on Thursday, September 10th. They issued an “outperform” rating and a $155.00 target price for the company. Piper Sandler lowered CommVault Systems from an “overweight” rating to a “neutral” rating and set a $133.00 price objective for the company. in a research note on Tuesday, July 28th. Truist Financial reissued a “buy” rating and set a $200.00 target price (up from $182.00) on shares of CommVault Systems in a research report on Wednesday. Oppenheimer boosted their price objective on CommVault Systems from $150.00 to $175.00 and gave the stock an “outperform” rating in a research note on Friday, July 17th. Finally, KeyCorp raised their price target on shares of CommVault Systems from $175.00 to $200.00 and gave the company an “overweight” rating in a research report on Wednesday. One research analyst has rated the stock with a Strong Buy rating, ten have given a Buy rating and ten have assigned a Hold rating to the company. According to MarketBeat, the stock has a consensus rating of “Moderate Buy” and a consensus target price of $174.00.

CommVault Systems News Roundup

Here are the key news stories impacting CommVault Systems this week:

• Positive Sentiment: Fiscal Q2 earnings beat estimates: Commvault reported adjusted EPS of $1.38, ahead of the $1.25 consensus and up from $0.91 a year earlier. Revenue increased 13.1% year over year to $312.39 million, also exceeding expectations. Commvault Announces Second Quarter Fiscal 2027 Financial Results
• Positive Sentiment: Recurring-revenue momentum remained strong: Subscription revenue rose 21% to $269 million, while subscription ARR reached $1.104 billion, up 20%. The company also generated $75 million in operating cash flow and $71 million in free cash flow, supporting the growth story. Commvault Fiscal Q2 Results
• Positive Sentiment: Analyst sentiment improved: Truist Financial reaffirmed a Buy rating and raised its target to $200 from $182. KeyCorp lifted its target to $200 from $175 with an Overweight rating, while Wells Fargo raised its target to $185 from $155 and also assigned an Overweight rating. Truist analyst action
• Neutral Sentiment: Royal Bank of Canada increased its price target to $180 from $160 but retained a Sector Perform rating, signaling that valuation and risk-reward remain balanced. RBC analyst action
• Positive Sentiment: Commvault introduced identity-resilience capabilities covering Active Directory, Entra ID and Okta. The tools are designed to identify Tier 0 exposure and help customers remediate identity risks before cyberattacks, strengthening the company’s cybersecurity product positioning. Commvault Identity Resilience Announcement
• Negative Sentiment: Near-term profit-taking may be limiting the response: CVLT is close to its 52-week high, trades at a high price-to-earnings multiple, and has already rallied substantially above its longer-term moving averages. Those factors can prompt investors to lock in gains even after a solid earnings report.

Insider Buying and Selling

In other news, CFO Gary Merrill sold 1,854 shares of the business’s stock in a transaction dated Tuesday, August 18th. The stock was sold at an average price of $143.64, for a total value of $266,308.56. Following the completion of the transaction, the chief financial officer owned 70,921 shares of the company’s stock, valued at $10,187,092.44. The trade was a 2.55% decrease in their position. The sale was disclosed in a filing with the SEC, which is available through the SEC website. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Also, CAO Danielle Abrahamsen sold 486 shares of the business’s stock in a transaction dated Wednesday, August 19th. The shares were sold at an average price of $142.80, for a total transaction of $69,400.80. Following the completion of the sale, the chief accounting officer owned 12,160 shares in the company, valued at approximately $1,736,448. This trade represents a 3.84% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. The transaction was executed under a pre-arranged Rule 10b5-1 trading plan. The sale was made to cover tax withholding obligations related to the vesting of equity awards. Insiders sold 29,348 shares of company stock worth $4,202,441 over the last 90 days. Corporate insiders own 0.86% of the company’s stock.

About CommVault Systems

Commvault Systems, Inc develops data protection and cyber resilience software and services for businesses, government organizations and other institutions. Its platform is designed to help customers back up, recover, manage and secure data across on-premises infrastructure, private and public clouds, software-as-a-service applications and other distributed IT environments.

The company’s offerings include backup and recovery, disaster recovery, data security, ransomware protection, cyber-recovery capabilities and data management tools.