Commvault Systems Inc. today reported fiscal first quarter earnings that topped analyst expectations across the board.

The company’s shares jumped 18.2% on the results. 

Commvault logged $282 million in sales during the three months ended June 30, 26% more than a year earlier. The Zacks consensus estimate projected $268.7 million. Commvault generated about two thirds of its quarterly revenue from selling subscriptions to its software products, which help enterprises back up and recover their data.

The company’s subscription business is built on two main pillars. It sells term-based licenses, which allow customers to use on-premises versions of Commvault’s software for a predetermined amount of time. The rest of Commvault’s subscription revenue comes from its software-as-a-service portfolio, which is one of the company’s biggest growth drivers.

The data protection provider saw its SaaS revenue jump 66% in the first quarter to $72 million. The sales increase was driven by a combination of deals with new customers and increased demand from existing users. Commvault’s SaaS net dollar retention rate, a measure of how existing customers increase their spending over time, stood at 125% during the quarter.

The company’s SaaS portfolio is headlined by a platform called Commvault Cloud. It can create backups of data stored in public cloud environments, SaaS applications and on-premises infrastructure. Commvault says that the platform can restore files near-instantaneously in some cases. 

Some ransomware strands encrypt not only the production copy of a company’s data but also the backups, which makes recovery impossible. To avoid such situations, Commvault Cloud stores backups in an immutable form that can’t be deleted or modified.

According to the company, its platform can help companies not only recover from ransomware attacks but also prevent them. Commvault Cloud creates files dubbed threat sensors that mimic assets such as databases. When hackers attempt to compromise those files, the platform detects that a cyberattack is underway. It then notifies administrators, who can remediate the breach before a significant number of records are compromised.

In the first quarter, Commvault expanded its cybersecurity capabilities by acquiring a startup called Satori Cyber Ltd. The company developed a platform that can scan an organization’s network for sensitive data such as user credentials. If an important record is stored insecurely, Satori automatically applies access controls that limit who may use it.

Commvault will use the technology to help customers secure their artificial intelligence projects. According to the company, Satori’s software lends itself to protecting AI training datasets. Furthermore, the software ships with a feature that can monitor the input and output of large language models.

Commvault’s adjusted EBIT, or earnings before interest and taxes, reached $58 million in the first quarter. That amounts to $1.01 per share, well ahead of the $0.97 forecasted by analysts. 

“Commvault delivered a strong start to the fiscal year, fueled by customer growth, disciplined execution, and rising demand for our industry-leading cyber resilience platform,” said Commvault Chief Executive Officer Sanjay Mirchandani (pictured).

The company has raised its revenue guidance for the full fiscal year. Commvault is now projecting sales of about $1.16 billion, up from $1.13 billion to $1.14 billion at the time of its previous earnings report. 

Photo: Commvault