Commvault Announces Q3 FY2024 Results

Commvault Announces Q3 FY2024 Results

Chris EvansCloud, Commvault Systems, Inc., Data Practice: Data Protection, Data Protection

Commvault Systems Inc. has announced financial results for Q3 FY2024.  Overall revenue is up 11.1% year-on-year and 7.9% sequentially.  Subscription revenue is up 30.7% year-on-year, while total ARR grew 17%.  The subscription approach seems to be working for the company.  Is this a sign of long-term growth?

Background

Commvault Systems reported financial data for Q3 FY2024 on 30 January 2024.  The results show $216.8 million in revenue, up 11.1% year-on-year and 7.9% sequentially.  Subscription revenue (representing 52.7% of the total) was up 30.7% year-on-year.  In Q1 FY2023, the first year Commvault itemised subscription revenue, the percentage contribution was 44.3%.

Figure 1 – Commvault Financials

The data is shown in 5 graphs.  Figures 1 & 2 show annual data up to the end of FY2023, while Figure 3 shows revenue and expenses by quarter.  Figure 4 shows data mapped by quarters, making it easier to see the year-on-year change.  Figure 5 shows the percentage contributions of revenue streams from Q1 FY2023 to the current reporting period.

Figure 2 – Commvault P&L

Subscriptions

As we have highlighted in previous blog posts, Commvault is in a transformation process that started with the launch of Metallic in 2019.  As early as February 2021 (three years ago), we indicated that the future direction for the whole of Commvault was the move to a subscription-based model, led by Metallic.  The launch of Metallic enabled Commvault to leave behind any long-term biases on its data protection products and instead transform them into a platform where the customer doesn’t need to worry about the minutiae of systems management. 

Figure 3 – Quarterly financials

In November 2023, the pivot into a new business model was completed with the launch of Commvault Cloud, powered by Metallic AI.  We covered the announcement in a blog post at the time. 

Figure 4 – Revenue by quarter

SaaS

Commvault Cloud addresses the direction we see data protection heading.  Customers now have data at the edge, in the public cloud, on-premises and in SaaS applications.  It’s no longer a requirement to run IT in-house, which begs the question, without any infrastructure, where would data protection software run? 

Figure 5 – Revenue Proportions

The answer is to build data protection as a SaaS platform.  With the fast iteration that SaaS provides, new features and functionality can be quickly added, which is especially critical in the evolution of the entire data protection industry toward cyber-resilience. 

The Architect’s View®

These results represent a good quarter for Commvault.  However, the journey is not over.  SaaS applications represent a significant part of modern IT, requiring data protection for myriad platforms.  In the future, we would like to see Metallic expanded to cover any SaaS platform rather than just the most popular.  However, aside from that, it is clear that Commvault is on the right path, as witnessed by the revenue numbers.  The standard for SaaS-based data protection has been set. 

Copyright (c) 2007-2024 – Post #9989 – Brookend Ltd, first published on https://www.architecting.it/blog, do not reproduce without permission. Commvault is a Tracked Vendor by Architecting IT for data protection and storage systems. Commvault has previously been a customer of Architecting IT and Brookend Ltd.