New York, January 28, 2026, 08:59 (EST) — Premarket
- CVLT saw little movement ahead of the open, following a sharp drop on Tuesday.
- Investors are digesting a weaker net new ARR figure alongside changes in deal mix.
- Price targets were slashed by analysts as attention shifts to whether ARR can bounce back in the March quarter.
Shares of Commvault Systems (CVLT) climbed roughly 0.7% to $89.74 in early trading Wednesday, rebounding slightly after Tuesday’s steep 31% drop that sent the stock down to $89.13. 1
Shares plunged after Commvault’s quarterly results and a reset in net new annualized recurring revenue, or net new ARR, which annualizes subscription contract values. The company reported net new ARR at $39 million. Chief accounting officer Danielle Abrahamsen told analysts that “70% of our net new ARR was driven by SaaS,” referring to subscription-based cloud software. 2
This is crucial because Commvault’s bullish outlook has hinged on recurring revenue growth, driven by a shift from upfront licenses to subscriptions. The stock’s reaction revealed just how fast that narrative can shift when ARR momentum wavers, even though the company continues to post strong revenue gains.
Commvault reported a 19% jump in total revenue to a record $314 million for its fiscal third quarter ended Dec. 31. Total ARR climbed 22% to $1.085 billion. CEO Sanjay Mirchandani described it as “another quarter of healthy growth and profitability.” The company projects fiscal 2026 revenue between $1.177 billion and $1.180 billion, with total ARR expected to grow around 18%. 3
The company’s outlook highlighted cash and cost measures. It projected fiscal-year free cash flow between $215 million and $220 million, noting that this estimate includes one-time payments related to a cost optimization initiative. Commvault also reported roughly $250 million left on its share repurchase program as of Jan. 14. 4
Cantor Fitzgerald lowered its price target to $100 from $144 while maintaining a Neutral rating, calling the quarter “relatively strong” but flagging net new ARR that fell short of expectations. After Commvault reported $39 million in net new ARR, management shifted guidance to a $40 million to $45 million range, Cantor noted. 5
Mizuho’s Michael Romanelli cut his price target to $140 from $180 but kept an Outperform rating. The firm flagged a shortfall in ARR and noted the impact of a higher SaaS mix on deals. 6
On Tuesday, a U.S. securities filing included the earnings release in a Form 8-K. 7
Commvault’s earnings discussion comes as it ramps up its cloud offerings. On Monday, it announced an expanded partnership with Google Cloud, rolling out new features like “Air Gap Protect” backups and “Cloud Rewind.” Some Google Workspace protection tools are now accessible through Google Cloud Marketplace. Google Cloud’s Asad Khan highlighted that these enhancements provide customers with stronger shields “against ransomware.” Omdia analyst Todd Thiemann pointed out that attackers are increasingly zeroing in on backup infrastructure. 8
Commvault faces competition in enterprise backup and cyber-recovery software from players like Rubrik and the privately owned Veeam. With a crowded market, quarterly results often fluctuate based on deal timing and contract details.
Near-term, shareholders face the risk that net new ARR remains uneven if the pipeline shifts toward smaller starter SaaS deals or longer-term contracts that dilute ARR growth. Another quarter showing “good revenue, soft ARR” would probably weigh on the stock again.
Investors are eyeing whether net new ARR rebounds to the $40 million to $45 million range, while subscription ARR growth remains steady into the fiscal fourth quarter. Commvault’s fiscal year wraps up on March 31, 2026, making the next earnings report the key event to watch. 9
