What factors drove the changes in Nutanix's revenue and profit?

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What does Nutanix do and what are its main business segments?

What is the market's earnings forecast for Nutanix next quarter?

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What were the key takeaways from Nutanix’s earnings call?

What guidance did Nutanix's management provide for the next earnings period?

- **Revenue Growth with Timing Shift**: Q1 ARR up 18% to $2.28B, but FY26 revenue guidance reduced to $2.82–$2.86B due to deferred revenue (20%+ to FY27).
- **Key Drivers**: Land-and-expand bookings with future start dates (+15% Q1 revenue deferral), third-party OEM shipments, and potential supply chain constraints.
- **Financial Resilience**: Free cash flow guidance raised to $800–$840M, supported by upfront cash collection despite deferred recognition.
- **Strategic Focus**: Expanding hybrid multi-cloud capabilities (e.g., Dell PowerStore, Pure Storage) and AI-driven modernization to capture VMware migrations.

**【CEO Summary Section】**
- Q1 revenue of $671 million, within guided range, with ARR growing 18% YoY to $2.28 billion.
- Notable wins include a North American agricultural provider and a European government agency, showcasing hybrid multi-cloud capabilities.
- Emphasized progress in supporting external storage (e.g., Dell PowerFlex) and AI-driven modernization.
- FY26 full-year revenue guidance reduced to $2.82–$2.86 billion due to deferred revenue timing, but free cash flow guidance increased to $800–$840 million.

**【CFO Financial Commentary】**
- Q1 non-GAAP gross margin 88%, operating margin 19.7%, and free cash flow $175 million (26% margin).
- Updated FY26 guidance: revenue $2.82–$2.86 billion (12% YoY growth), operating margin 21%–22%, free cash flow $800–$840 million.
- Revenue shift due to: 1) land-and-expand bookings with future start dates, 2) third-party OEM shipments, 3) potential supply chain constraints.
- Free cash flow benefits from upfront cash collection despite deferred revenue recognition.

**【Q&A Highlights】**
- **Bookings & Timing**: Q1 bookings ahead of expectations, but 15%+ of revenue deferred due to future start dates (e.g., Broadcom migrations). FY26 bookings growth unchanged, but 20%+ of deferred revenue expected to shift to FY27.
- **Supply Chain**: Anecdotal reports of component shortages; mitigated by diversifying server partners (Cisco, Dell) and expanding hardware compatibility.
- **OEM Impact**: Dell PowerStore and Pure Storage integrations expected to accelerate FY26/27 growth, though revenue recognition tied to partner shipments.
- **Margins & Investment**: Operating margin maintained at 21%–22% despite lower revenue, balancing growth investments with efficiency.
- **U.S. Federal Business**: Q1 growth >10% YoY, but variability expected due to government shutdown and policy changes.

Nutanix, Inc. (NTNX) Q1 2026 Earnings Call Transcript

- **Record Growth**: FY25 revenue $2.54B (18% YoY), ARR $2.22B (17% YoY), free cash flow $750M (30% margin).
- **Strategic Wins**: 2,700+ new logos, including 2 Dell PowerFlex Global 2000 deals and a $50M customer migration with FI.
- **AI & Cloud Expansion**: GPT-in-a-Box 2.0, Google Cloud support, and Pure Storage partnership on track for H2 2025 GA.
- **FY26 Outlook**: 15% revenue growth, 21%-22% operating margin, $790M-$830M free cash flow.
- **Multiyear Opportunity**: VMware replacement pipeline of 200K+ customers, with largest deals pending.

**【CEO Summary Section】**
- **Q4 and FY25 Financial Highlights**: Revenue of $653M (19% YoY), ARR of $2.22B (17% YoY), free cash flow of $750M (30% margin). FY25 Rule of 40 score: 48%.
- **Strategic Wins**: 
  - **Finanz Informatik (FI)**: Multi-year deal to migrate 50M customer workloads, emphasizing trust and cost-effectiveness.
  - **Global 2000 Expansion**: 2,700+ new logos, including 50+ Global 2000 accounts, highest in 4 years.
  - **Dell PowerFlex Early Success**: 2 North American Global 2000 wins in Q4, preserving external storage investments.
- **Product & AI Advancements**: GPT-in-a-Box 2.0, Nutanix Enterprise AI with NVIDIA integration, Google Cloud support in public preview.
- **Industry Recognition**: Leader in Gartner Magic Quadrant for Distributed Hybrid Infrastructure, Challenger in Container Management.

**【CFO Financial Commentary】**
- **Q4 '25 Results**: 
  - Revenue: $653M (19% YoY), above guidance.
  - Non-GAAP EPS: $0.37, GAAP EPS: $0.13.
  - Free cash flow: $208M (32% margin).
- **FY25 Full Year**: 
  - Revenue: $2.54B (18% YoY), Non-GAAP net income: $476M.
  - Gross margin: 88.1%, operating margin: 21.1%.
- **FY26 Guidance**: 
  - Revenue: $2.9B-$2.94B (15% YoY midpoint).
  - Operating margin: 21%-22%.
  - Free cash flow: $790M-$830M (27.7% margin).
- **Key Assumptions**: 
  - 50-70 new logos/Q4, slower renewal cohort growth, $25M delayed hiring costs, $10M-$15M partner payment tapering.

**【Q&A Key Highlights】**
- **NRR Dynamics**: Q4 NRR 108% (down 2pts QoQ) due to ARR timing, larger new logo deals, and law of large numbers.
- **Dell PowerFlex & Pure Storage**: 
  - PowerFlex: 2 Q4 wins, GA by end-2025; Pure: early access, GAH2 2025.
  - Targeting large enterprises with existing external storage investments.
- **Federal Government**: 10%+ of revenue, longer deal cycles, but optimistic on modernization opportunities.
- **AI Adoption**: Early innings, use cases in fraud detection, document summarization; GPT-in-a-Box 2.0 in production with select customers.
- **VMware Replacement**: 200K+ VMware customers remain, multi-year journey; completed migrations up to 70K cohorts, largest deals pending.


Nutanix, Inc. (NTNX) Q4 2025 Earnings Call Transcript

- **Revenue beats expectations**: $639M (+22% YoY), ARR $2.14B (+18% YoY), free cash flow $203M.
- **Key wins highlight platform strength**: Multi-cloud, AI/ML, and hybrid infrastructure adoption.
- **Partnerships accelerate growth**: Dell PowerFlex, Google Cloud, NVIDIA Enterprise AI integrations.
- **Profitability improves**: Non-GAAP net income $125M, operating margin 21.5%, free cash flow margin 32%.
- **FY25 guidance raised**: Revenue $2.52B-$2.53B, operating margin 20.5%, free cash flow $700M-$730M.
- **Long-term focus**: Modern applications, hybrid multi-cloud, and AI/ML platform expansion.

**【CEO Summary Section】**
- Q3 revenue of $639M exceeded guidance (22% YoY growth), driven by ARR growth of 18% to $2.14B and strong free cash flow of $203M.
- Highlighted key wins: 
  - EMEA IT solutions provider adopting GPT-in-a-box 2.0 and replacing OpenShift.
  - North American asset manager selecting Nutanix hybrid multi-cloud platform over AWS.
  - EMEA-based Fortune 500 company replacing incumbent supplier with Nutanix.
- Announced new partnerships: 
  - General availability of Dell PowerFlex support for external storage.
  - Google Cloud integration in early access.
  - Nutanix Enterprise AI 2.0 with NVIDIA Enterprise AI frameworks.
- Emphasized focus on modern applications, hybrid multi-cloud, and AI/ML solutions.

**【CFO Financial Commentary】**
- Q3 non-GAAP net income: $125M (EPS $0.42), up 24% YoY.
- Full-year updated guidance: 
  - Revenue $2.52B-$2.53B (17.5% YoY growth at midpoint).
  - Non-GAAP operating margin 20.5%.
  - Free cash flow $700M-$730M (28% margin).
- Key financial metrics: 
  - Gross margin 88.2%, operating margin 21.5%.
  - NRR 110%, contract duration 3.1 years.
  - Cash balance $1.88B, $38M share buyback.
- Tax rate update: 20% non-GAAP effective tax rate forward, vs 6% in FY24.

**【Q&A Highlights】**
- **Macro environment**: U.S. federal business seeing longer deal cycles but solid demand for TCO savings.
- **Kubernetes adoption**: Early momentum with D2iQ acquisition, but still small contribution.
- **Dell/Cisco partnerships**: 
  - Dell PowerFlex solution GA in Q3, early customer traction.
  - Cisco contributing to new logo growth across segments.
- **ARR vs revenue**: ARR growth reflects install base expansion, while revenue includes upfront license recognition.
- **FY26 outlook**: Sustained investment in sales and R&D, with margin improvements from mix shift to renewals.
- **VMware displacement**: 620 new logos in Q3, many migrating from VMware with multi-year contracts.
- **AI strategy**: Nutanix Enterprise AI 2.0 enabling enterprise-grade ML workflows, integrated with NVIDIA frameworks.


Nutanix, Inc. (NTNX) Q3 2025 Earnings Call Transcript

- **Revenue Beats Expectations**: Q2 revenue ($655M, +16% YoY) and ARR ($2.06B, +19% YoY) exceed guidance, with new logo growth >50% YoY.
- **Strategic Wins**: Secured Global 2000 deals with 30% IT footprint reduction and GenAI deployments, including a European telemedicine platform.
- **Financial Strength**: Free cash flow of $187M (29% margin) and $1.74B ending cash, with FY25 guidance raised across all metrics.
- **GenAI Leadership**: 80% of enterprises implementing GenAI; Nutanix NAI enables efficient LLM scaling for multilingual chatbots.
- **M&A and Partnerships**: $862M convertible notes for flexibility; PowerFlex storage launch in Q2 CY24 and Cisco/Dell channel growth drive new logo momentum.

**【CEO Summary Section】**
- **Revenue and ARR Growth**: Q2 revenue reached $655 million (16% YoY), with ARR surpassing $2.06 billion (19% YoY). New logo growth exceeded 50% YoY for the second consecutive quarter.
- **Customer Wins**: Secured major deals with Global 2000 companies, including a North American energy tech firm migrating from a 200% price-hiking competitor and a European health ministry deploying a telemedicine platform on Nutanix Kubernetes.
- **Strategic Initiatives**: Expanded partnerships with AWS, Cisco, and Dell; launched PowerFlex storage solution in Q2 CY24; and strengthened financial flexibility with $862.5M convertible notes and a $500M credit facility.
- **GenAI Momentum**: 80% of enterprises are implementing GenAI, with Nutanix Enterprise AI (NAI) enabling efficient scaling of LLMs. A financial services firm in EMEA adopted NAI for multilingual chatbots and translation services.

**【CFO Financial Commentary】**
- **Topline Performance**: Q2 non-GAAP EPS of $0.56 exceeded expectations, driven by 16% YoY revenue growth and 24.6% operating margin (vs. guided 20-21%).
- **Cash Flow and Balance Sheet**: Free cash flow of $187M (29% margin) and ending cash of $1.74B, up 62% QoQ. Used $862.5M convertible notes proceeds to retire debt, repurchase $200M shares, and bolster liquidity.
- **FY25 Guidance Update**: Raised full-year revenue to $2.495-2.515B (17% YoY midpoint), operating margin to 17.5-18.5%, and free cash flow to $650-700M. Investments in sales, marketing, and R&D will accelerate in H2.

**【Q&A Highlights】**
- **New Logo Growth**: 50% YoY new logo growth driven by pipeline maturity, go-to-market programs, and channel leverage. 60% of ARR growth comes from new customers.
- **Federal Business**: Q2 Fed revenue returned to YoY growth after Q1 underperformance. 10%+ of annual revenue historically, with Q1 as seasonally strong due to U.S. fiscal year-end.
- **Kubernetes Adoption**: Nutanix Kubernetes Platform (NKP) is 100% CNCF-compliant, enabling hybrid/multi-cloud deployments. A Global 2000 IT services firm migrated 30% of estate from a competitor to NKP.
- **Sales Cycles and Pricing**: 30%+ of deals involve multi-year contracts. Pricing pressure minimal; focus on value proposition and long-term TCO savings.
- **M&A Strategy**: Future acquisitions will target technical gaps or new opportunities, such as 2023's Mesosphere (Kubernetes) and 2024's PowerFlex (storage).

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