Commvault Systems (CVLT) Q3 2025 earnings summary

Executive summary

• Q3 revenue rose 21% year-over-year to $263 million, driven by strong subscription growth and new customer wins, with SaaS ARR up 71–75% in constant currency.

• Total ARR reached $890 million, up 18% year-over-year, with subscription ARR at $734 million, up 29% year-over-year.

• Non-GAAP EBIT margin was 20.8% for Q3, with GAAP net income at $11.0 million ($0.24 per diluted share).

• Strategic investments in innovation, go-to-market execution, and partner ecosystem expansion fueled global growth and customer wins.

• Acquisitions of Clumio and Appranix expanded cyber resiliency offerings and contributed to revenue growth.

Financial highlights

• Subscription revenue grew 39% year-over-year to $158 million, accounting for 58–60% of total revenue; SaaS ARR reached $259 million, up 71–75% year-over-year.

• Q3 gross margin was 81–82%, reflecting a higher SaaS mix and modest dilution from acquisitions.

• Free cash flow for Q3 was $30 million, with $31.9–$32 million in share repurchases.

• Cash and cash equivalents at quarter-end were $243.6–$244 million.

• Operating margin for the quarter was 5.2% GAAP, 20.8% non-GAAP.

Outlook and guidance

• Q4 revenue expected at $260–$264 million, subscription revenue $160–$164 million, and non-GAAP EBIT margin 20–21%.

• FY25 total ARR guidance raised to $980–$985 million (19–20% growth), subscription ARR up 28–30%, and free cash flow $170–$200 million.

• Tracking ahead of FY26 targets of $1B+ ARR and $330M SaaS ARR.

• Plan to allocate over 75% of FY25 free cash flow to share repurchases.

• Restructuring plan to enhance customer success functions expected to complete by FY25 year-end.