CommVault Systems, Inc.(NASDAQ:CVLT) stock closed on a positive note on Jan 24th, 2017 rising over 2.6% post their third quarter of 2018 performance.
The group delivered a sequential rise in their software growth, solid billings growth and a solid operating cash flow. The group expects Commvault HyerScale Appliance and Commvault HyperScale Software to drive Q4 ’18 revenues.
For the third quarter of 2018, Overall revenues rose 8% yoy to $180.4 million while Quarterly billings (total revenue plus the sequential change in deferred revenue rose over 13% yoy to $192 million. Software and products revenue enhanced 4% yoy to $81.4 million. Software revenues surged 13% sequentially and 4% year-over-year. Overall revenues enhanced 8% on a year-over-year basis while EBIT margin reached 12.2%. CommVault Systems delivered a record quarterly revenue of $180.4 million driven by enterprise revenue transactions rise. Billings rose on the back of a 19% year-over-year rise in the deferred revenue.
In EMEA services revenue rose 12% on a year-over-year basis driven by professional services results. The Operating cash flows rose 17% yoy to $31.2 million, given the subscription-based pricing models, which currently represent over 20% of their third quarter of 2018 and year-to-date software revenue, is more than double of the historical run rate, which is contributing to the growth in deferred revenue.
Subscription-based pricing represented over 20% of software revenue in both Q3 and year-to-date fiscal 2018, which is more than double than the pre-fiscal 2018 run rate. Revenue from enterprise deals, (which are over $100,000 in software revenue in a given quarter), represented 57% of software revenue. Revenue from these transactions rose 4% on a year-over-year basis and 9% sequentially. Average enterprise deal size increased 3% year-over-year to over $268,000 during the quarter. The group made a goof progress in managing data in the Cloud, approaching 200 petabytes in the Cloud, which is over 3x over the prior year.
Going forward, CommVault Systems would focus on a better revenue and operating margins by major improvement in field productivity. They are implementing changes in their go-to-market strategy that are specifically designed to drive higher field productivity. They are focusing on high impact key alliance partners that are strategically aligned including Cisco, Microsoft, Infinidat, HPE and others that should be announced in the near future. The group witnessed a solid customer acquisition of their managed services and SaaS business and expect this acceleration to continue through FY19.