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CommVault Systems Inc. CVLT reported fourth-quarter fiscal 2020 non-GAAP earnings of 30 cents per share that missed the Zacks Consensus Estimate by 23.1%. Moreover, the figure declined 41.2% from the year-ago quarter.
Fourth-quarter revenues of $164.7 million missed the consensus mark by 4.2%. The figure decreased 9.2% year over year due to coronavirus-led business lockdown globally.
Revenues from Americas and Europe, the Middle East and Africa (EMEA) declined 12% and 2.4% to $95.9 million and $49 million, respectively. Meanwhile, Asia Pacific and Japan (APJ) revenues declined 10.7% to $19.9 million.
Notably, the company closed multiple seven-figure deals and won many new customers including McDonald's, Blue Cross Blue Shield Minnesota, the city of Philadelphia, the Polish Ministry of Finance and Shared Services Canada, which provides IT services to Canada’s government in the reported quarter.
Segment-wise, Software and product (40.3% of revenues) declined 17.8% on a year-over-year basis to $66.4 million excluding $10 million of completed subscription renewals that will be recognized in the first quarter of fiscal 2021, when the current subscriptions are due to expire.
Services revenues (59.7% of total revenues) in fourth-quarter fiscal 2020 were $98.3 million, a decrease of 2% year over year. Revenues from customer support services increased 0.2% year over year to $90.1 million, partially offset by 23.1% decline in professional services revenues that came in at $8.2 million.
CommVault Systems Inc Price, Consensus and EPS Surprise
CommVault Systems Inc price-consensus-eps-surprise-chart | CommVault Systems Inc Quote
In the reported quarter, gross profit declined 6.5% year over year to $138.2 million. Gross margin expanded 240 basis points (bps) to 83.9% on a year-over-year basis.
Meanwhile, general and administrative (G&A) expenses declined 39% to $21 million. As a percentage of revenues, G&A was 12.8%, down 620 bps from the year-ago quarter.
Sales and marketing (S&M) expenses declined 6.4% year over year to $82.9 million. However, research and development (R&D) expenses increased 60.2% on a year-over-year basis to $32.7 million. However, as percentage of revenues, S&M and R&D expenses declined 150 bps and 860 bps, respectively.
Non-GAAP income from operations in fourth-quarter fiscal 2020 was $18.3 million, down 40.9% from the year-ago period.
Balance Sheet & Cash Flow
As of Mar 31, 2020, CommVault Systems had total cash, restricted cash and short-term investments of $339.7 million.
Operating cash flow totaled $32.5 million in the fourth quarter of fiscal 2020.
During the fiscal fourth quarter, Commvault Systems repurchased $37.2 million of common stock (872 thousand shares), bringing the fiscal 2020 total repurchases to $77.2 million (1.7 million shares).
Zacks Rank & Stocks to Consider
Currently, Commvault Systems carries a Zacks Rank #3 (Hold).
NVIDIA Corporation NVDA, Workday Inc WDAY and Okta Inc. OKTA are some better-ranked stocks in the broader computer and technology sector. All three stocks carry a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
NVIDIA, Workday and Okta are set to report quarterly results on May 21, 26 and 28, respectively.
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