TINTON
FALLS, N.J., Oct. 31,
2023 /PRNewswire/ -- Commvault [Nasdaq: CVLT]
today announced its financial results for the fiscal second quarter
ended September 30, 2023.
"Our Q2 total revenue growth accelerated, driven by our
hyper-growth SaaS platform, and we delivered robust operating
margin leverage," said Sanjay
Mirchandani, President and CEO. "Next week, at Commvault
SHIFT, we'll unveil our cyber resilience platform, combining our
leading data protection capabilities with comprehensive new
security and AI-powered innovations that are critical for customers
in an era of escalating cyber-attacks."
Notes are contained at the end of this Press Release.
Fiscal 2024 Second Quarter Highlights -
- Total revenues were $201.0
million, up 7% year over year
- Total ARR1 grew to $711
million, up 18% year over year
- Subscription revenue was $97.8
million, up 25% year over year
- Subscription ARR1 grew to $530 million, up 32% year over year
- Income from operations (EBIT) was $17.6
million, an operating margin of 8.8%
- Non-GAAP EBIT2 was $42.0
million, an operating margin of 20.9%
- Operating cash flow of $40.3
million, with free cash flow2 of $40.1 million
- Second quarter share repurchases were $31.3 million, or approximately 442,000 shares of
common stock
Financial Outlook for Third Quarter and Full Year Fiscal
2024 -
We are providing the following guidance for the third quarter of
fiscal year 2024:
- Total revenues are expected to be between $206 million and $210
million
- Subscription revenue is expected to be between $106 million and $110
million
- Non-GAAP operating margin2 is expected to be
approximately 21%
We are providing the following updated guidance for the full
fiscal year 2024:
- Total revenues are expected to be between $812 million and $822
million
- Total ARR1 is expected to grow 14% year over
year
- Subscription revenue is expected to be between $408 million and $418
million
- Non-GAAP operating margin2 is expected to grow
between 50 to 100 basis points year over year
- Free cash flow2 is expected to be approximately
$170 million
The above statements are based on the incorporation of actual
second quarter results and current targets. These statements are
forward looking and made pursuant to the safe harbor provisions
discussed in detail below. We do not undertake any obligation to
update these forward-looking statements. Actual results may differ
materially from anticipated results.
Conference Call Information
Commvault will host a conference call today, October 31,
2023 at 8:30 a.m. Eastern Time
(5:30 a.m. Pacific Time) to discuss
quarterly results. The live webcast and call dial-in numbers can be
accessed by registering under the "Events" section of Commvault's
website. An archived webcast of this conference call will also be
available following the call.
About Commvault
Commvault (NASDAQ: CVLT) is a global leader in cloud data
protection. Our industry-leading platform redefines the next
generation of data protection as the only solution with
comprehensive data protection, proactive data defense, advanced
ransomware protection, and a single view across all your data. This
lets you secure, defend, and recover your data, applications, and
production workloads – on-premises, in the cloud, over SaaS, or
spread across hybrid and multi-cloud environments. The result is
early warning of attacks, active defense to reduce the impact of
intrusion, and rapid, accurate recovery of your data. Simply put,
Commvault is data, protected. For over 25 years, more than 100,000
organizations have relied on Commvault to keep their data secure
and ready to drive business growth. Learn more at
Commvault.com or follow us at @Commvault.
Safe Harbor Statement
This press release may contain forward-looking statements,
including statements regarding financial projections, which are
subject to risks and uncertainties, such as competitive factors,
difficulties and delays inherent in the development, manufacturing,
marketing and sale of software products and related services,
general economic conditions, outcome of litigation and others. For
a discussion of these and other risks and uncertainties affecting
Commvault's business, see "Item IA. Risk Factors" in our annual
report on Form 10-K and "Item 1A. Risk Factors" in our most recent
quarterly report on Form 10-Q. Statements regarding Commvault's
beliefs, plans, expectations or intentions regarding the future are
forward-looking statements, within the meaning of Section 27A of
the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. All such
forward-looking statements are made pursuant to the safe harbor
provisions of the Private Securities Litigation Reform Act of 1995.
Actual results may differ materially from anticipated results.
Commvault does not undertake to update its forward-looking
statements.
Revenue Overview
($ in thousands)
|
Q2'23
|
|
Q3'23
|
|
Q4'23
|
|
Q1'24
|
|
Q2'24
|
Revenue
Summary:
|
|
|
|
|
|
|
|
|
|
Subscription
|
$
78,239
|
|
$
87,380
|
|
$
94,537
|
|
$
97,290
|
|
$
97,757
|
Perpetual
license
|
19,831
|
|
19,728
|
|
17,561
|
|
13,155
|
|
14,388
|
Customer
support
|
77,996
|
|
77,665
|
|
77,335
|
|
76,915
|
|
77,019
|
Other
services
|
11,991
|
|
10,301
|
|
14,045
|
|
10,790
|
|
11,833
|
Total
revenues
|
$
188,057
|
|
$
195,074
|
|
$
203,478
|
|
$
198,150
|
|
$
200,997
|
|
|
Q2'23
|
|
Q3'23
|
|
Q4'23
|
|
Q1'24
|
|
Q2'24
|
Y/Y Growth:
|
|
|
|
|
|
|
|
|
|
Subscription
|
50 %
|
|
13 %
|
|
9 %
|
|
11 %
|
|
25 %
|
Perpetual
license
|
(28) %
|
|
(30) %
|
|
(25) %
|
|
(26) %
|
|
(27) %
|
Customer
support
|
(11) %
|
|
(10) %
|
|
(9) %
|
|
(5) %
|
|
(1) %
|
Other
services
|
12 %
|
|
(8) %
|
|
28 %
|
|
(4) %
|
|
(1) %
|
Total
revenues
|
6 %
|
|
(4) %
|
|
(1) %
|
|
— %
|
|
7 %
|
Constant Currency
($ in thousands)
The constant currency impact is calculated using the average
foreign exchange rates from the prior year period and applying
these rates to foreign-denominated revenues in the current
corresponding period. Commvault analyzes revenue growth on a
constant currency basis in order to provide a comparable framework
for assessing how the business performed excluding the effect of
foreign currency fluctuations. The non-GAAP financial measures
presented in this press release should not be considered as a
substitute for, or superior to, the measures of financial
performance prepared in accordance with GAAP.
|
Subscription
|
|
Perpetual
License
|
|
Customer
Support
|
|
Other
Services
|
|
Total
|
Q2'23
Revenue As Reported (GAAP)
|
$
78,239
|
|
$
19,831
|
|
$
77,996
|
|
$
11,991
|
|
$
188,057
|
Q2'24
Revenue As Reported (GAAP)
|
$
97,757
|
|
$
14,388
|
|
$
77,019
|
|
$
11,833
|
|
$
200,997
|
% Change Y/Y
(GAAP)
|
25 %
|
|
(27) %
|
|
(1) %
|
|
(1) %
|
|
7 %
|
Constant Currency
Impact
|
$
(953)
|
|
$
(328)
|
|
$
(1,205)
|
|
$
(108)
|
|
$
(2,594)
|
% Change Y/Y Constant
Currency
|
24 %
|
|
(29) %
|
|
(3) %
|
|
(2) %
|
|
6 %
|
Revenues by Geography
($ in thousands)
Our Americas region includes the
United States, Canada, and
Latin America. Our International
region primarily includes Europe,
Middle East, Africa, Australia, India, Southeast
Asia, and China.
|
Q2'23
|
|
Q3'23
|
|
Q4'23
|
|
Q1'24
|
|
Q2'24
|
|
Revenue
|
Y/Y
Growth
|
|
Revenue
|
Y/Y
Growth
|
|
Revenue
|
Y/Y
Growth
|
|
Revenue
|
Y/Y
Growth
|
|
Revenue
|
Y/Y
Growth
|
Americas
|
$
116,191
|
11 %
|
|
$
108,107
|
(9) %
|
|
$
122,337
|
(1) %
|
|
$
122,124
|
— %
|
|
$
120,300
|
4 %
|
International
|
71,866
|
(2) %
|
|
86,967
|
3 %
|
|
81,141
|
(1) %
|
|
76,026
|
1 %
|
|
80,697
|
12 %
|
Total
revenues
|
$
188,057
|
6 %
|
|
$
195,074
|
(4) %
|
|
$
203,478
|
(1) %
|
|
$
198,150
|
— %
|
|
$
200,997
|
7 %
|
Total ARR and Subscription ARR1
($ in
thousands)
|
Q2'23
|
|
Q3'23
|
|
Q4'23
|
|
Q1'24
|
|
Q2'24
|
Total
ARR1
|
$
604,392
|
|
$
640,731
|
|
$
668,411
|
|
$
686,028
|
|
$
711,462
|
Subscription
ARR1
|
$
400,480
|
|
$
442,684
|
|
$
477,085
|
|
$
499,580
|
|
$
529,590
|
Income from Operations (EBIT)
- Income from operations (EBIT) was $17.6
million, an 8.8% operating margin
- Non-GAAP EBIT2 was $42.0
million, a 20.9% operating margin
GAAP and Non-GAAP Net Income2
- GAAP net income was $13.0
million, or $0.29 per diluted
share
- Non-GAAP net income2 was $31.5 million, or $0.70 per diluted share
Cash Summary and Share Repurchases
- Cash flow from operations was $40.3
million in the second quarter
- As of September 30, 2023, ending
cash and cash equivalents was approximately $283.3 million
- During the second quarter, Commvault repurchased
$31.3 million, or approximately
442,000 shares, of common stock at an average share price of
approximately $70.88 per share
Table
I
Commvault Systems,
Inc.
Consolidated
Statements of Operations
(In thousands,
except per share data)
(Unaudited)
|
|
Three Months
Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Revenues:
|
|
|
|
|
|
|
|
Subscription
|
$
97,757
|
|
$
78,239
|
|
$
195,047
|
|
$
165,867
|
Perpetual
license
|
14,388
|
|
19,831
|
|
27,543
|
|
37,629
|
Customer
support
|
77,019
|
|
77,996
|
|
153,934
|
|
159,313
|
Other
services
|
11,833
|
|
11,991
|
|
22,623
|
|
23,229
|
Total
revenues
|
200,997
|
|
188,057
|
|
399,147
|
|
386,038
|
Cost of
revenues:
|
|
|
|
|
|
|
|
Subscription
|
14,643
|
|
8,893
|
|
27,006
|
|
19,878
|
Perpetual
license
|
642
|
|
656
|
|
1,054
|
|
1,282
|
Customer
support
|
14,898
|
|
15,423
|
|
29,855
|
|
30,456
|
Other
services
|
7,670
|
|
7,330
|
|
15,488
|
|
14,443
|
Total cost of
revenues
|
37,853
|
|
32,302
|
|
73,403
|
|
66,059
|
Gross margin
|
163,144
|
|
155,755
|
|
325,744
|
|
319,979
|
Operating
expenses:
|
|
|
|
|
|
|
|
Sales and
marketing
|
84,712
|
|
81,299
|
|
168,839
|
|
166,218
|
Research and
development
|
31,261
|
|
37,053
|
|
62,692
|
|
77,166
|
General and
administrative
|
28,002
|
|
25,553
|
|
54,961
|
|
52,529
|
Restructuring
|
—
|
|
—
|
|
—
|
|
2,132
|
Depreciation and
amortization
|
1,535
|
|
2,537
|
|
3,138
|
|
5,172
|
Total operating
expenses
|
145,510
|
|
146,442
|
|
289,630
|
|
303,217
|
Income from
operations
|
17,634
|
|
9,313
|
|
36,114
|
|
16,762
|
Interest
income
|
1,369
|
|
291
|
|
2,149
|
|
552
|
Interest
expense
|
(112)
|
|
(105)
|
|
(208)
|
|
(210)
|
Other income (expense),
net
|
(154)
|
|
154
|
|
187
|
|
(235)
|
Income before income
taxes
|
18,737
|
|
9,653
|
|
38,242
|
|
16,869
|
Income tax
expense
|
5,720
|
|
5,135
|
|
12,596
|
|
8,840
|
Net income
|
$
13,017
|
|
$ 4,518
|
|
$ 25,646
|
|
$
8,029
|
Net income per common
share:
|
|
|
|
|
|
|
|
Basic
|
$ 0.30
|
|
$ 0.10
|
|
$
0.58
|
|
$
0.18
|
Diluted
|
$ 0.29
|
|
$ 0.10
|
|
$
0.57
|
|
$
0.18
|
Weighted average common
shares outstanding:
|
|
|
|
|
|
|
|
Basic
|
43,949
|
|
44,759
|
|
44,003
|
|
44,751
|
Diluted
|
44,903
|
|
45,540
|
|
45,010
|
|
45,745
|
Table
II
Commvault Systems,
Inc
Condensed
Consolidated Balance Sheets
(In
thousands)
(Unaudited)
|
|
|
September
30,
|
|
March
31,
|
|
|
2023
|
|
2023
|
ASSETS
|
Current
assets:
|
|
|
|
|
Cash and cash
equivalents
|
|
$
283,287
|
|
$
287,778
|
Trade accounts
receivable, net
|
|
196,434
|
|
210,441
|
Assets held for
sale
|
|
38,680
|
|
38,680
|
Other current
assets
|
|
21,560
|
|
14,015
|
Total current
assets
|
|
539,961
|
|
550,914
|
|
|
|
|
|
Property and equipment,
net
|
|
7,471
|
|
8,287
|
Operating lease
assets
|
|
12,995
|
|
11,784
|
Deferred commissions
cost
|
|
58,855
|
|
59,612
|
Intangible assets,
net
|
|
1,667
|
|
2,292
|
Goodwill
|
|
127,780
|
|
127,780
|
Other assets
|
|
23,963
|
|
21,905
|
Total assets
|
|
$
772,692
|
|
$
782,574
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
Current
liabilities:
|
|
|
|
|
Accounts
payable
|
|
$
136
|
|
$
108
|
Accrued
liabilities
|
|
93,788
|
|
97,888
|
Current portion of
operating lease liabilities
|
|
4,848
|
|
4,518
|
Deferred
revenue
|
|
304,977
|
|
307,562
|
Total current
liabilities
|
|
403,749
|
|
410,076
|
|
|
|
|
|
Deferred revenue, less
current portion
|
|
174,061
|
|
174,393
|
Deferred tax
liabilities, net
|
|
495
|
|
134
|
Long-term operating
lease liabilities
|
|
9,194
|
|
8,260
|
Other
liabilities
|
|
3,670
|
|
3,613
|
|
|
|
|
|
Total stockholders'
equity
|
|
181,523
|
|
186,098
|
Total liabilities and
stockholders' equity
|
|
$
772,692
|
|
$
782,574
|
Table
III
Commvault Systems,
Inc
Consolidated
Statements of Cash Flows
(In
thousands)
(Unaudited)
|
|
Three Months
Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Cash flows from
operating activities
|
|
|
|
|
|
|
|
Net income
|
$
13,017
|
|
$ 4,518
|
|
$ 25,646
|
|
$
8,029
|
Adjustments to
reconcile net income to net cash provided by operating
activities:
|
|
|
|
|
|
|
|
Depreciation and
amortization
|
1,564
|
|
2,878
|
|
3,196
|
|
5,855
|
Noncash stock-based
compensation
|
23,615
|
|
25,327
|
|
47,339
|
|
56,422
|
Noncash change in fair
value of equity securities
|
154
|
|
(155)
|
|
(187)
|
|
234
|
Amortization of
deferred commissions cost
|
6,430
|
|
5,442
|
|
12,749
|
|
10,756
|
Changes in operating
assets and liabilities:
|
|
|
|
|
|
|
|
Trade accounts
receivable, net
|
(19,812)
|
|
6,474
|
|
8,245
|
|
15,863
|
Operating lease assets
and liabilities, net
|
(7)
|
|
102
|
|
65
|
|
(181)
|
Other current assets
and Other assets
|
(2,439)
|
|
2,249
|
|
(3,832)
|
|
(461)
|
Deferred commissions
cost
|
(6,961)
|
|
(6,365)
|
|
(12,561)
|
|
(13,017)
|
Accounts
payable
|
(146)
|
|
(695)
|
|
32
|
|
(213)
|
Accrued
liabilities
|
15,567
|
|
2,762
|
|
(3,963)
|
|
(28,604)
|
Deferred
revenue
|
8,959
|
|
6,206
|
|
1,746
|
|
16,464
|
Other
liabilities
|
396
|
|
1,101
|
|
899
|
|
1,130
|
Net cash provided by
operating activities
|
40,337
|
|
49,844
|
|
79,374
|
|
72,277
|
Cash flows from
investing activities
|
|
|
|
|
|
|
|
Purchase of property
and equipment
|
(266)
|
|
(514)
|
|
(1,413)
|
|
(1,381)
|
Purchase of equity
securities
|
(260)
|
|
(778)
|
|
(572)
|
|
(1,793)
|
Net cash used in
investing activities
|
(526)
|
|
(1,292)
|
|
(1,985)
|
|
(3,174)
|
Cash flows from
financing activities
|
|
|
|
|
|
|
|
Repurchase of common
stock
|
(31,327)
|
|
(39,864)
|
|
(82,357)
|
|
(58,787)
|
Proceeds from
stock-based compensation plans
|
5,167
|
|
6,672
|
|
6,368
|
|
7,359
|
Payment of debt
issuance costs
|
—
|
|
—
|
|
—
|
|
(63)
|
Net cash used in
financing activities
|
(26,160)
|
|
(33,192)
|
|
(75,989)
|
|
(51,491)
|
Effects of exchange
rate — changes in cash
|
(4,953)
|
|
(11,588)
|
|
(5,891)
|
|
(22,634)
|
Net increase (decrease)
in cash and cash equivalents
|
8,698
|
|
3,772
|
|
(4,491)
|
|
(5,022)
|
Cash and cash
equivalents at beginning of period
|
274,589
|
|
258,713
|
|
287,778
|
|
267,507
|
Cash and cash
equivalents at end of period
|
$ 283,287
|
|
$ 262,485
|
|
$
283,287
|
|
$
262,485
|
Table
IV
Commvault Systems,
Inc
Reconciliation of
GAAP to Non-GAAP Financial Measures
(In
thousands, except per share data)
(Unaudited)
|
|
Three Months
Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Non-GAAP financial
measures and reconciliation:
|
|
|
|
|
|
|
|
GAAP income from
operations
|
$
17,634
|
|
$ 9,313
|
|
$
36,114
|
|
$
16,762
|
Noncash stock-based
compensation3
|
23,615
|
|
25,327
|
|
47,339
|
|
55,135
|
FICA and payroll tax
expense related to stock-based compensation4
|
471
|
|
425
|
|
1,485
|
|
1,335
|
Restructuring5
|
—
|
|
—
|
|
—
|
|
2,132
|
Amortization of
intangible assets6
|
312
|
|
312
|
|
626
|
|
626
|
Non-GAAP income
from operations
|
$
42,032
|
|
$
35,377
|
|
$
85,564
|
|
$
75,990
|
|
|
|
|
|
|
|
|
GAAP net
income
|
$
13,017
|
|
$ 4,518
|
|
$
25,646
|
|
$ 8,029
|
Noncash stock-based
compensation3
|
23,615
|
|
25,327
|
|
47,339
|
|
55,135
|
FICA and payroll tax
expense related to stock-based compensation4
|
471
|
|
425
|
|
1,485
|
|
1,335
|
Restructuring5
|
—
|
|
—
|
|
—
|
|
2,132
|
Amortization of
intangible assets6
|
312
|
|
312
|
|
626
|
|
626
|
Non-GAAP provision for
income taxes adjustment7
|
(5,927)
|
|
(4,508)
|
|
(11,081)
|
|
(11,706)
|
Non-GAAP net
income
|
$
31,488
|
|
$
26,074
|
|
$
64,015
|
|
$
55,551
|
|
|
|
|
|
|
|
|
Diluted weighted
average shares outstanding
|
44,903
|
|
45,540
|
|
45,010
|
|
45,745
|
Non-GAAP diluted
earnings per share
|
$
0.70
|
|
$
0.57
|
|
$
1.42
|
|
$
1.21
|
|
|
Three Months
Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Non-GAAP free cash
flow reconciliation:
|
|
|
|
|
|
|
|
GAAP cash provided by
operating activities
|
$
40,337
|
|
$
49,844
|
|
$
79,374
|
|
$
72,277
|
Purchase of property
and equipment
|
(266)
|
|
(514)
|
|
(1,413)
|
|
(1,381)
|
Non-GAAP free cash
flow
|
$
40,071
|
|
$
49,330
|
|
$
77,961
|
|
$
70,896
|
Use of Non-GAAP Financial Measures
Commvault has provided in this press release the following
non-GAAP financial measures: non-GAAP income from operations
(EBIT), non-GAAP income from operations margin, non-GAAP net
income, non-GAAP diluted earnings per share, non-GAAP free cash
flow, annualized recurring revenue (ARR) and subscription ARR. This
financial information has not been prepared in accordance with
GAAP. Commvault uses these non-GAAP financial measures internally
to understand, manage and evaluate its business and make operating
decisions. In addition, Commvault believes these non-GAAP operating
measures are useful to investors, when used as a supplement to GAAP
financial measures, in evaluating Commvault's ongoing operational
performance. Commvault believes that the use of these non-GAAP
financial measures provides an additional tool for investors to use
in evaluating ongoing operating results and trends, and in
comparing its financial results with other companies in Commvault's
industry, many of which present similar non-GAAP financial measures
to the investment community. Commvault has also provided its
revenues on a constant currency basis. Commvault analyzes revenue
growth on a constant currency basis in order to provide a
comparable framework for assessing how the business performed
excluding the effect of foreign currency fluctuations.
All of these non-GAAP financial measures should be considered as
a supplement to, and not as a substitute for, financial information
prepared in accordance with GAAP. Investors are encouraged to
review the reconciliation of these non-GAAP measures to their most
directly comparable GAAP financial measures, which are included in
this press release.
Non-GAAP income from operations and non-GAAP income from
operations margin. These non-GAAP financial measures
exclude noncash stock-based compensation charges and additional
Federal Insurance Contribution Act (FICA) and related payroll tax
expense incurred by Commvault when employees exercise in the money
stock options or vest in restricted stock awards. Commvault has
also excluded restructuring costs and noncash amortization of
intangible assets from its non-GAAP results. These expenses are
further discussed in Table IV. Commvault believes that these
non-GAAP financial measures are useful metrics for management and
investors because they compare Commvault's core operating results
over multiple periods. When evaluating the performance of
Commvault's operating results and developing short- and long-term
plans, Commvault does not consider such expenses.
Although noncash stock-based compensation and the additional
FICA and related payroll tax expenses are necessary to attract and
retain employees, Commvault places its primary emphasis on
stockholder dilution as compared to the accounting charges related
to such equity compensation plans. Commvault believes that
providing non-GAAP financial measures that exclude noncash
stock-based compensation expense and the additional FICA and
related payroll tax expenses incurred on stock option exercises and
vesting of restricted stock awards allow investors to make
meaningful comparisons between Commvault's operating results and
those of other companies.
There are a number of limitations related to the use of non-GAAP
income from operations and non-GAAP income from operations
margin. The most significant limitation is that these
non-GAAP financial measures exclude certain operating costs,
primarily related to noncash stock-based compensation, which is of
a recurring nature. Noncash stock-based compensation has been, and
will continue to be for the foreseeable future, a significant
recurring expense in Commvault's operating results. In
addition, noncash stock-based compensation is an important part of
Commvault's employees' compensation and can have a significant
impact on their performance. The following table presents the
stock-based compensation expense included in cost of revenues,
sales and marketing, research and development and general and
administrative ($ in thousands):
|
Three Months Ended
September 30,
|
|
Six Months Ended
September 30,
|
|
2023
|
|
2022
|
|
2023
|
|
2022
|
Cost of
revenues
|
$
1,599
|
|
$
1,226
|
|
$
3,289
|
|
$
2,469
|
Sales and
marketing
|
9,941
|
|
10,165
|
|
19,645
|
|
21,558
|
Research and
development
|
5,385
|
|
7,793
|
|
10,732
|
|
17,034
|
General and
administrative
|
6,690
|
|
6,143
|
|
13,673
|
|
14,074
|
Stock-based
compensation expense
|
$
23,615
|
|
$
25,327
|
|
$
47,339
|
|
$
55,135
|
The components that Commvault excludes in its non-GAAP financial
measures may differ from the components that its peer companies
exclude when they report their non-GAAP financial measures. Due to
the limitations related to the use of non-GAAP measures,
Commvault's management assists investors by providing a
reconciliation of each non-GAAP financial measure to the most
directly comparable GAAP financial measure. Commvault's management
uses non-GAAP financial measures only in addition to, and in
conjunction with, results presented in accordance with
GAAP.
Non-GAAP net income and non-GAAP diluted earnings per share
(EPS). In addition to the adjustments discussed in
non-GAAP income from operations, non-GAAP net income and non-GAAP
diluted EPS incorporates a non-GAAP effective tax rate of
27%.
Commvault anticipates that in any given period its non-GAAP tax
rate may be either higher or lower than the GAAP tax rate as
evidenced by historical fluctuations. The GAAP tax rates in recent
fiscal years were not meaningful percentages due to the dollar
amount of GAAP pre-tax income. For the same reason as the
GAAP tax rates, the estimated cash tax rates in recent fiscal years
are not meaningful percentages. Commvault defines its cash tax rate
as the total amount of cash income taxes payable for the fiscal
year divided by consolidated GAAP pre-tax income. Over time,
Commvault believes its GAAP and cash tax rates will align.
Commvault considers non-GAAP net income and non-GAAP diluted EPS
useful metrics for Commvault management and its investors for the
same basic reasons that Commvault uses non-GAAP income from
operations and non-GAAP income from operations margin. In addition,
the same limitations as well as management actions to compensate
for such limitations described above also apply to Commvault's use
of non-GAAP net income and non-GAAP diluted EPS.
Non-GAAP free cash flow. Commvault defines this
non-GAAP financial measure as net cash provided by operating
activities less purchases of property and equipment. Commvault
considers non-GAAP free cash flow a useful metric for Commvault
management and its investors in evaluating Commvault's ability to
generate cash from its business operations. In addition, the same
limitations as well as management actions to compensate for such
limitations described above also apply to Commvault's use of
non-GAAP free cash flow.
Notes
- Annualized Recurring Revenue (ARR) is defined as the annualized
recurring value of all active contracts at the end of a reporting
period. It includes the following contract types:
subscription (including term licenses, SaaS and utility software),
maintenance contracts related to perpetual licenses, other extended
maintenance contracts (enterprise support), and managed services.
It excludes any element of the arrangement that is not expected to
recur, primarily perpetual licenses and most professional services.
Subscription ARR includes only term licenses, SaaS and utility
software arrangements. Contracts are annualized by dividing the
total contract value by the number of days in the contract term,
then multiplying by 365.
ARR should be viewed independently of GAAP revenue, deferred
revenue and unbilled revenue and is not intended to be combined
with or to replace those items. ARR is not a forecast of future
revenue. Management believes that reviewing this metric, in
addition to GAAP results, helps investors and financial analysts
understand the value of Commvault's recurring revenue streams
versus prior periods.
- A reconciliation of GAAP to non-GAAP results has been provided
in Financial Statement Table IV included in this press release. An
explanation of these measures is also included under the heading
"Use of Non-GAAP Financial Measures."
- Represents noncash stock-based compensation charges associated
with restricted stock units granted and our Employee Stock Purchase
Plan, exclusive of stock-based compensation expense related
to Commvault's restructuring activities described below in
note 5.
- Represents additional FICA and related payroll tax expenses
incurred by Commvault when employees exercise in-the-money
stock options or vest in restricted stock awards.
- These restructuring charges relate primarily to severance and
related costs associated with headcount reductions and stock-based
compensation related to modifications of existing unvested awards
granted to certain employees impacted by the restructuring
plan.
- Represents noncash amortization of intangible assets.
- The provision for income taxes is adjusted to
reflect Commvault's estimated non-GAAP effective tax rate of
27%.
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SOURCE COMMVAULT