Commvault subscription revenue rises 21% as ARR tops $1.1 billion

Commvault's subscription revenue rose 21% in its fiscal second quarter, and the data protection and cyber resilience software company nudged up its full-year subscription revenue and recurring revenue targets.

Subscription revenue reached $269 million for the quarter ended Sept. 30, including software-as-a-service revenue of $106 million, up 33%, according to the earnings release attached to its 8-K on Tuesday. Subscription annualized recurring revenue, or ARR, rose 20% to $1.104 billion.

"With AI accelerating both innovation and risk in the enterprise, resilience continues to be a business imperative," President and CEO Sanjay Mirchandani said.

Profit and cash

GAAP income from operations was $30 million, a 9.7% operating margin. Non-GAAP operating income, or EBIT, was $68 million, a 21.9% margin. Operating cash flow was $75 million and free cash flow was $71 million.

Net new subscription ARR was $51 million in constant currency, the company said.

Outlook

For the fiscal third quarter, Commvault expects subscription revenue of $293 million to $297 million and a non-GAAP EBIT margin of 20.5% to 21.0%.

For fiscal 2027, it now expects:

• Subscription revenue of $1.127 billion to $1.133 billion
• Subscription ARR of $1.205 billion to $1.215 billion, a midpoint of $1.210 billion versus $1.205 billion in June guidance
• Non-GAAP EBIT margin of 21.0% to 21.5%
• Free cash flow of $255 million to $265 million

The company also highlighted new products during the quarter, including an Active Directory recovery tool and an integration of its Threat Scan with Google Threat Intelligence.

By the numbers

• Subscription revenue: $269 million, up 21%
• SaaS revenue: $106 million, up 33%
• Subscription ARR: $1.104 billion, up 20%
• Free cash flow: $71 million

Sources

1. COMMVAULT SYSTEMS INC, Form 8-K with fiscal second quarter 2027 earnings release, filed Oct. 27, 2026 (accession 0001169561-26-000032)

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