Updated with interview:

Commvault Systems Inc. today reported better-than-expected financial results for its fiscal fourth quarter ended March 31.

The company, which provides data protection and management software, attributed the results partly to strong demand for its Metallic product. Metallic is a software-as-a-service backup and recovery platform. The platform surpassed $100 million in annualized recurring revenue during the fourth quarter, a little over three years after launching.

“Commvault closed out the year strong, highlighted by Metallic eclipsing the $100 million ARR mark, 15% year-over-year total ARR growth, and strong cash flow,” said Chief Executive Sanjay Mirchandani (pictured). “We enter the new fiscal year with momentum and confidence that Commvault customers are future proofed for the road ahead.” 

Tinton Falls, New Jersey-based Commvault sells software that enterprises use to create backup copies of their data and restore them in the event of an outage. The company also offers tools for other tasks, such as reducing the amount of storage space required for an organization’s files. It says its products are used by about 100,000 customers worldwide.

The company generated revenue of $203.5 million in the quarter ended March 31. That’s 1% less than a year ago, but represents a 2% increase in constant currency. Moreover, it managed to top the Zacks consensus estimate by over 3%.

The quarterly sales decline was the result of slowed demand for the offerings included in Commvault’s software and products revenue segment. The segment includes, among other offerings, the company’s on-premises Hyperscale X backup appliance. Software and products revenue dropped 10% year-over-year, to $90.2 million.

In contrast, Commvault’s services business grew its revenues by 7% on a year-over-year basis. The business, which includes the Metallic backup and recovery platform, generated sales of $113.2 million in the quarter.

Metallic includes more than a half-dozen modules each designed to back up a different type of data. The platform can back up files stored on employee devices and in popular software-as-a-service platforms such as Salesforce. Additionally, Metallic includes tools for protecting data stored in backend systems such as databases.

One of the latest additions to the Metallic product line, a tool called ThreatWise, expanded the platform’s focus to cybersecurity when it launched last October. ThreatWise deploys decoy files throughout a company’s storage environment. The tool spots breaches by detecting when a hacker attempts to access one of the decoys.

Commvault disclosed today that Metallic’s net retention rate, a measure of how existing customers increase their customers over time, stood at 125% in the fourth quarter. The company also disclosed 70% of the organizations adopting the platform are new customers.

The volume of transactions that Metallic is bringing into Commvault is at a different scale, hundreds of customers every quarter.” Mirchandani told Dave Vellante, host of SiliconANGLE Media’s video studio theCUBE today. “A large percentage of those customers become Commvault customers.”

Its adjusted EBIT, or earnings before interest and taxes, amounted to $45.4 million in the fourth quarter. That represents adjusted earnings of 73 cents per share. Analysts polled for the Zacks consensus estimate expected 63 cents per share.

Commvault’s total sales in the fiscal year ended March 31 added up to $784.6 million, which represents an annual increase of 2%. For the current quarter, it’s projecting revenue of between $195 million and $199 million.

Talking today with Vellante, Mirchandani examined the earnings results in depth, Commvault’s transition to a cloud model and data protection more broadly:

Photo: Commvault