Commvault Systems
NASDAQ: CVLT
$142.39 ▲ +1.25  (+0.89%)
At close: Jul 24, 2026 · 3:59 PM UTC
Financial Ratios
Market Cap6.21 Bn
P/E87.84
P/S5.24
Div. Yield0.00
Revenue Growth (1y) (Qtr)13.33
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About

Commvault Systems, Inc. specializes in cyber resiliency, offering data protection and recovery solutions for on-premises, hybrid, and multi-cloud environments. The company delivers software, software-as-a-service, integrated appliances, and partner-managed services to safeguard data against cyber threats, including ransomware. Commvault’s platform provides layered defenses, automated recovery verification, and cloud-native capabilities to ensure continuous business…

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Sector: Technology Industry: Software - Application CIK: 0001169561

Investment Thesis

▲ Bull case
  • AI driven data expansion creates structural tailwind for Commvault's platform as more data means higher demand for protection governance and trusted recovery. Management highlighted AI as powerful tailwind and noted that compromised data compromises AI models. The company is already monetizing AI related use cases through Satori integration and AI studio capabilities. This positions Commvault to capture incremental ARR from AI workloads that are growing faster than traditional IT spend.
  • Multiproduct adoption and identity resilience are underappreciated growth levers. The percentage of SaaS customers using more than one offering rose to 48% representing a 500 basis point improvement. Identity and data security contributed 33% of net new ARR in Q4. The sales compensation plan is geared toward new logos and cross sell which should accelerate platform expansion and increase average revenue per account. This creates a durable upsell engine that is not yet fully reflected in current guidance.
  • Strong cash flow generation and shareholder return provide a floor for valuation. The company generated record free cash flow of $132 million in Q4 and $237 million for the fiscal year. Guidance for FY27 calls for $250 million to $260 million free cash flow and a $250 million share repurchase authorization. This capital return policy combined with improving non GAAP EBIT margin toward 20.5% signals confidence in sustainable profitability and reduces downside risk.
  • Hybrid cloud resilience and partnerships with major hyperscalers and Red Hat OpenShift unlock new markets. The Red Hat Summit sponsorship and booth #329 demonstrate deepening integration with OpenShift Virtualization. The ability to protect workloads across on premise private and public clouds with a single control plane addresses fragmentation concerns of enterprises adopting containerized and multi cloud strategies. This structural shift toward unified resilience is a long term driver that is not yet priced in.
▼ Bear case
  • The shift toward lower ASP SaaS deals is diluting reported ARR growth and has already caused a guidance miss. In Q3 FY26 net new ARR came in at $39 million versus $45 million target leading to a 31% stock drop and ensuing securities class actions. Management attributes the miss to SaaS mix shift but the pattern suggests that reported ARR may continue to understate true revenue contribution. This could create volatility in future ARR reporting.
  • Dependence on macroeconomic factors such as memory and component pricing creates headwinds that could limit new logo acquisition. Although management cites partnerships and sweat the asset strategy, sustained increases in hardware costs may force customers to prioritize only essential workloads. This may delay or reduce spending on supplemental resilience products. Consequently the pace of new customer addition and multiproduct expansion could slow.
  • The identity resilience opportunity while promising remains early stage and execution risk is high. The buying persona is split between CSO and CIO organizations requiring coordinated sales efforts. The company has not disclosed specific ASP or deal size for identity products and the current adoption base is small. Failure to effectively cross sell identity solutions could leave a large portion of the promised 33% of net new ARR unrealized.
  • Legal and reputational overhang from the securities fraud allegations poses an overhang that could deter institutional investors and increase volatility. The lawsuit alleges materially false or misleading statements regarding ARR growth trajectory and guidance. Even if the company ultimately prevails the distraction and potential settlement costs could affect cash flow. This could divert management focus from operational initiatives.

Product and Service Breakdown of Revenue (2026)

Geographical Breakdown of Revenue (2026)

Peer Comparison

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