CommVault Systems 2025 Q4 Earnings Misses Targets as Net Income Declines 75%

CommVault Systems (CVLT) reported its fiscal 2025 Q4 earnings on May 05th, 2025. The total revenue of CommVault Systems increased by 23.2% to $275.04 million in 2025 Q4, up from $223.29 million in 2024 Q4. CommVault Systems's EPS declined 75.7% to $0.70 in 2025 Q4 from $2.90 in 2024 Q4. Meanwhile, the company's net income declined to $30.99 million in 2025 Q4, down 75.4% from $126.12 million reported in 2024 Q4. Despite the drop in EPS, the company achieved a record high for fiscal Q4 net income, marking the highest in 20 years. The stock price of CommVault Systems has edged up 2.59% during the latest trading day, has climbed 4.84% during the most recent full trading week, and has climbed 4.57% month-to-date.

Revenue
The total revenue for CommVault Systems reached $275.04 million in Q4 2025, marking a 23.2% year-over-year increase. Subscription revenue surged by an impressive 45% to $173 million, highlighting strong demand for the company’s cloud-based offerings. The perpetual license segment contributed $14.96 million, reflecting a slight decline, while customer support services generated $76.5 million, showing a marginal decrease. Other services brought in $10.34 million, indicating a more notable drop in performance. Overall, the robust growth in subscription revenue was a key driver in the company’s total revenue increase.

Earnings/Net Income
CommVault Systems saw a significant decline in its earnings per share (EPS), dropping 75.7% to $0.70 in Q4 2025 from $2.90 in Q4 2024. Net income also fell sharply by 75.4%, reaching $30.99 million compared to $126.12 million the previous year. Despite these decreases, the company achieved a record high for fiscal Q4 net income, the highest in 20 years. The stark decline in EPS signals a challenging financial quarter.

Post-Earnings Price Action Review
Historically, CommVault Systems' earnings report metrics have led to positive returns for investors, with backtest data indicating a tendency for the stock price to perform well post-earnings. Revenue metrics have shown a favorable market reaction, with win rates of 56.62% over 3 days, 57.34% over 10 days, and 62.20% over 30 days. Similarly, net income metrics reflect similar win rates, suggesting that investors respond positively to net income-related news. EPS, however, has demonstrated the most significant influence on stock price, with the highest returns of 11.56% observed over a 30-day period, highlighting its importance to market expectations. Overall, all three metrics—revenue, net income, and EPS—have historically contributed to short-term gains for CVLT stockholders, with EPS being the most critical factor.

CEO Commentary
“We surpassed all key metrics, ended the year with over 12,000 subscription customers, and are firmly positioned as a growth company with subscription revenue up 45% in Q4,” said Sanjay Mirchandani, President and CEO of Commvault. He highlighted that the company delivered cloud-first innovations addressing cyber resilience challenges, showcasing strong customer acquisition and growth in their land business. Mirchandani acknowledged competition from other vendors but expressed confidence in Commvault's hybrid cloud capabilities and broad technology offerings, emphasizing their strategy to enhance product resilience and support emerging workloads, including AI.

Guidance
Commvault expects total revenues for FY2026 to be between $1,130 million and $1,140 million, with subscription revenue projected between $727 million and $732 million. For the first quarter, total revenues are anticipated to range from $266 million to $270 million. The company also guides for a non-GAAP operating margin of approximately 21% and free cash flow expected between $210 million and $215 million, reflecting a balanced approach amidst current macroeconomic conditions.

Additional News
In recent non-earnings news, Commvault has been making strategic moves to enhance its cyber resilience offerings. The company announced a collaboration with CrowdStrike to deliver a unified set of services for incident response and cyber recovery. Additionally, Commvault won the "Outstanding Cyber Resilience" Global InfoSec Award for 2025, recognizing their innovation in cyber resilience at the RSAC Conference. Furthermore, Commvault has appointed industry veteran Bill O'Connell as Chief Security Officer, bringing nearly 20 years of experience to strengthen their security strategy. These developments highlight Commvault’s focus on expanding its capabilities and