Rubrik, Inc.(RBRK) - 2025 Q3 - Earnings Call Transcript

Financial Data and Key Metrics Changes - Rubrik surpassed $1 billion in subscription ARR, growing 38$221 million, growing 55% year-over-year [9][46] - Free cash flow was reported at over $15 million for the quarter [10][54] - Subscription ARR contribution margin improved by 1,100 basis points year-over-year, reaching negative 3$83 million, indicating strong performance in the cyber resilience market [9][43] - Customers with $100,000 or more in subscription ARR reached 2,085, growing 32$769 million, growing 69% [43] Market Data and Key Metrics Changes - Revenue from the Americas grew 46% to $169 million, while revenue from outside the Americas grew 35$67 million [47] - Subscription net retention rate remained above 120% [45] Company Strategy and Development Direction - Rubrik focuses on cyber resilience as a key market driver, emphasizing the need for comprehensive solutions across various data environments [11][14] - The company is expanding its product offerings, including the recent addition of Postgres SQL and Red Hat OpenShift virtualization [20] - Rubrik aims to leverage partnerships to enhance its go-to-market strategy, integrating with various technology partners [34][138] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the strength of the cyber resilience market and the demand for Rubrik's offerings [55] - The company raised its guidance for the full fiscal year 2025, expecting subscription ARR growth of approximately 35% [58] - Management noted that the transition from maintenance to subscription ARR is moderating, with no expected benefit in fiscal 2026 [60] Other Important Information - Rubrik announced the Rubrik Annapurna API service, aimed at accelerating the development of trusted generative AI applications [31][122] - The company is focused on innovation and long-term growth, with a commitment to building a secure data infrastructure for AI applications [32][124] Q&A Session Summary Question: Insights on cloud backup and third-party data protection tools - Management highlighted the need for a unified policy engine for cyber recovery across diverse data environments, which is why customers prefer Rubrik over native cloud solutions [72][73] Question: Contribution margin improvement and investment pace - Management confirmed that the subscription ARR contribution margin is expected to reach breakeven next fiscal year, with continued focus on efficiency and growth [76][78] Question: DSPM deals and their impact on sales cycles - Management noted that DSPM deals have doubled in volume, providing data risk visibility and enhancing cyber resilience, although they currently represent a smaller part of the business [84][86] Question: Total Addressable Market (TAM) in cybersecurity - Management explained that Rubrik's transformation of the backup and recovery market into a cyber resilience platform has expanded the TAM significantly [99][101] Question: Operating efficiency sustainability - Management expressed optimism about sustaining operating efficiency improvements, driven by higher productivity and a focus on renewals [103][104] Question: Adoption rate of enterprise edition - Management reported that about half of new customers are adopting the enterprise edition, contributing significantly to net retention rate [115] Question: Vision and evolution of Rubrik Annapurna - Management described Annapurna as a long-term strategy to build a centralized data platform for secure AI applications, with plans for market experimentation [122][125] Question: Go-to-market partnerships - Management confirmed increased engagement with VARs and GSIs, enhancing Rubrik's go-to-market strategy [136][140]