Commvault Systems, Inc.

Hello and welcome to the Commvault Q44 Year 2026 Earnings Conference Call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you would like to ask a question during this time, just press star followed by the number one on your telephone keypad. And if you would like to withdraw your question, press star one again. Thank you. Now I would like to turn the call over to Mike Molnick, Vice President of Investor Relations. Please go ahead, Mike.

Good morning, and welcome to our earnings conference call. Before we begin, I'd like to remind you that statements made on today's call will include forward-looking statements about Commvault's future expectations, plans, and prospects. All such forward-looking statements are subject to risks, uncertainties, and assumptions. Please refer to the cautionary language in today's earnings release and Commvault's most recent periodic reports filed with the SEC for discussion of the risk and uncertainties that could cause the company's actual results to be materially different from those contemplated in these forward-looking statements. Commvault does not assume any obligation to update these statements. All Commvault's financial results are presented on a non-GAAP basis. A reconciliation between the non-GAAP and GAAP measures can be found on our website. Thank you again for joining us. Now I'll turn it over to our CEO, Sanjay Merchandani, for his opening remarks. Sanjay?

Good morning, and thank you for joining us. We had a strong finish to the fiscal year, delivering results at or above our guided metrics, while continuing to build momentum across the business. In the fourth quarter, subscription ARR increased 27% to $989 million. This was led by another quarter of strong growth from our SaaS business, which grew 42%, to reach 400 million in ARR, a milestone for Commvault. Subscription revenue grew 20% to 208 million, and we generated a record free cash flow of 132 million in Q4, resulting in 237 million for the fiscal year. We're growing at scale while also generating strong profits and cash flow. We believe this combination reflects the health of the industry, the strength of our platform, and the durability of our model. Now let me take a step back and talk about what's driving this momentum. In one word, it's data. Data is the lifeblood of every organization. When it's down due to an outage, cyber attack, or human error, business comes to a halt. Organizations today are facing a variety of challenges with their data. First, data is scattered across environments, on-premise, at the edge, and in the cloud, expanding the attack surface for bad actors. Second, cyber attacks continue to grow in volume and sophistication. Adversaries are getting smarter and stronger. Compromise is almost certain. Third, identity has become one of the hottest new threat factors. This is compounded by AI, as non-human identities outnumber human identities by 50 to 1. Commvault helps organizations address today's challenges by protecting, identifying, securing, and when needed, rapidly recovering their data. But these challenges aren't static. With the rise of AI, we're in the most important technology shift in modern history. AI creates more data, more access, and more risk, directly increasing demand for protection, governance, and trusted recovery. We see AI as a powerful tailwind for Commvault because it amplifies the importance of what we do. In an AI-driven world, if your data is compromised, your AI is compromised. Commvault provides the picks and shovels that empower customers to adopt AI securely and responsibly. We do this in a variety of ways. We protect the data sets used for AI and a broad spectrum of AI workloads. We help customers leverage AI to detect threats faster, recover at greater scale, and automate resilience operations. We help customers activate AI data securely for use with models and agents. And we bring governance to AI data. For example, with our Satori app position now fully integrated into Commvault Cloud, customers can monitor and enforce agents' access to data. Additionally, as customers embrace and deploy AI, They're also focused on simplifying their technology stack. Enterprises don't want a patchwork of fragmented tools and products. They want the best unified platform to bring it all together, Commvault Cloud. Commvault Cloud unifies data protection, data security, identity resilience, and recovery all on one scalable control plane. Increasingly, more customers are standardizing on our platform as evidenced by growth we see across the business. Let me shine a light on some of the major growth drivers for Commvault, which will extend into fiscal year 27 and beyond. First, we continue to add new subscription customers to our platform. Second, we're expanding and driving multi-product adoption across our SaaS space. And third, we're seeing strong momentum with emerging revenue streams, including identity resilience. Now I'll discuss each of these in more detail. First, we added over 2,500 subscription customers in fiscal year 26. The growth-oriented investments we made over the past two years paid off. In the on-prem market, we're winning against other vendors while seeing customers return to Commvault after upstarts fail to live up to the hype. For example, in Q4, One of the world's top 50 law firms returned to Commvault because an upstart over-promised and under-delivered a product that were, quote, on the roadmap and did not work. This customer is now leveraging our software and SaaS solutions, including a complete suite of data security, identity resilience, and recovery offerings. Second, we're making steady progress in driving multi-product adoption, a core pillar of our growth strategy. This is especially true in our SaaS business. The percentage of Commvault managed SaaS customers using more than one offering increased to 48%, a 500 basis point improvement from Q4 of last year. For example, in Q4, we added a large virtual charter school that could not securely or efficiently manage its multi-cloud architecture with native hyperscaler tools. They chose Commvault to help manage their multi-cloud estate with the addition of AirGap, threat scan, and clean room recovery to meet the resiliency requirements. In fiscal year 27, we're doubling down and incentivizing our Salesforce to build on this multi-product momentum. Third, in terms of monetizing new offerings, we're seeing healthy momentum as identity becomes a primary target for attackers. Our Active Directory, Entry ID, and Office Solutions are landing new customers and expanding existing. In Q4, Active Directory was, once again, one of our fastest growing SaaS offerings, with AR more than doubling year over year. And collectively, our identity resilience and data security offerings represented 33% of net new ARR in Q4. For example, after a competitor suffered a crippling ransomware attack, a Fortune 500 retailer determined its resilience posture was too complex and costly. In Q4, they purchased Commvault's Active Directory protection because it provided lower TCO and reduced recovery time from two days to under 90 minutes. As identity threats continue to evolve, this will continue to be an area of focus and innovation for us in fiscal year 27. In closing, Commvault provides customers with a single unified platform that's essential for today's diverse data environments and tomorrow's AI-driven applications. Let me leave you with a few key takeaways. First, the market is getting bigger by the minute. AI is driving more data, more complexity, and more risk, increasing the need for resilience. As data grows, so does Commvault. Second, Commvault Cloud is the differentiator. Customers are consolidating fragmented tools and standardizing on a single platform for data protection, data security, identity resilience, and recovery. And third, we're delivering durable, high-quality growth. We're scaling SaaS, expanding within our customer base, and doing so with improved margins and strong cash flow. That is why we believe we're well-positioned to win in the AI era. And now I'll turn it over to Gary Merrill, who's back as our CFO, to discuss our results and outlook. We welcome him and Jeff Hayden as our new president of customer and field operations. Gary?