01—Abstract
Summary
Summary of the 10-Q filed June 13, 2024. Cited figures are marked; the original filing is the authoritative source.
Rubrik, Inc. (RBRK) filed this Quarterly Report on Form 10-Q for the three months ended April 30, 2024, its first quarterly report after completing its initial public offering in April 2024.
Revenue was $187.3 milliona, up from $135.7 million a year earlier, with subscription revenue rising to $172.2 million from $108.4 million. The company reported a net loss of $732.1 million, compared with $89.3 million in the prior-year quarter, driven largely by $630.3 million of stock-based compensation, much of it recognized upon the IPO's completion for restricted stock units with liquidity-event vesting conditions. Key operating metrics improved: Subscription ARR reached $856.1 million (up 46%), Cloud ARR reached $605.6 million (up 104%), and customers with $100,000 or more in Subscription ARR rose to 1,859 from 1,314.
The company's average subscription dollar-based net retention rate was over 120% as of April 30, 2024. Free cash flow was $(37.1) million, which included a $20.6 millionb cash outlay for employer payroll taxes tied to IPO-related equity vesting. Gross margin fell to 49% from 74%, reflected in the filing's discussion as driven by IPO-related stock-based compensation and higher hosting costs.
At quarter end, cash, cash equivalents and short-term investments totaled $606.3 millionc, against $297.1 million of noncurrent debt and an accumulated deficit of $2,414.6 million. The IPO raised net proceeds of approximately $710.3 million, of which $350.4 million was used for taxes paid on the net share settlement of equity awards. The company also issued $321.4 million of Bridge Notes in April 2024 to fund a portion of those tax obligations, repaid them on April 29, 2024, and recorded the full unamortized discount in interest expense.
02—Key points
Key Highlights
- Total revenue of $187.3 million for the three months ended April 30, 2024, up from $135.7 million, with subscription revenue up 59%.
- Net loss widened to $732.1 million from $89.3 million, primarily due to $630.3 million of stock-based compensation, largely recognized upon the IPO completion.
- Subscription ARR of $856.1 million, up 46%, and Cloud ARR of $605.6 million, up 104%.
- Gross margin declined to 49% from 74%, reflecting IPO-related stock-based compensation in cost of revenue and higher hosting costs for SaaS products.
- Customers with $100,000 or more in Subscription ARR increased to 1,859 from 1,314; average subscription dollar-based net retention rate was over 120%.
- Cash, cash equivalents and short-term investments of $606.3 million; IPO net proceeds of approximately $710.3 million, with $350.4 million paid for taxes on net share settlement of equity awards.
- Remaining non-cancellable performance obligations of approximately $1,378.1 million, with 47% expected to be recognized as revenue over the next 12 months.
03—One dollar
04—Financials
Financial Highlights
Figures from 10-QQ1 FY2025filed June 13, 2024Financial Statements
Q1 FY2025 against Q1 FY2024
| Line item | Q1 FY2025Q1 FY2024 | Change |
|---|---|---|
| Revenue | $187.31M$135.74M | +38.0% |
| Cost of Revenue | $95.98M$35.89M | +167.4% |
| Gross Profit | $91.34M$99.85M | −8.5% |
| R&D Expenses | $285.38M$46.27M | +516.8% |
| Operating Expenses | $816.17M$184.44M | +342.5% |
| Operating Income | -$724.84M-$84.60M | −756.8% |
| Interest Expense | $10.62M— | — |
| Net Income | -$732.09M-$89.27M | −720.1% |
| EPS (Basic) | $-11.48$-1.49 | −670.5% |
| EPS (Diluted) | $-11.48$-1.49 | −670.5% |
| Shares Outstanding (Basic) | 63.79M59.94M | +6.4% |
| Shares Outstanding (Diluted) | 63.79M59.94M | +6.4% |
05—Questions
Frequently Asked Questions
What drove the large increase in net loss this quarter?
The net loss of $732.1 million compared with $89.3 million a year earlier, mainly because of $630.3 million of total stock-based compensation. The filing states that a large share of this was recognized upon completion of the IPO for RSUs whose liquidity-event performance condition was satisfied.
How fast is the company's recurring revenue growing?
Subscription ARR grew 46% to $856.1 million as of April 30, 2024, and Cloud ARR grew 104% to $605.6 million. The filing notes that about three percentage points of Subscription ARR growth came from transitioning existing maintenance customers to subscription editions.
Why did gross margin fall so sharply?
Gross margin was 49% compared with 74% a year earlier. The filing attributes the decline mainly to stock-based compensation recognized upon the IPO in cost of revenue, along with higher hosting costs from developing and launching more SaaS products.
Does the company have enough liquidity and what is its debt position?
The company reported $606.3 million in cash, cash equivalents and short-term investments and stated that existing cash is expected to fund operations for at least the next 12 months. Noncurrent debt was $297.1 million, and the Amended Credit Facility matures in August 2028. The company also repaid $321.4 million of Bridge Notes on April 29, 2024.
What is the outlook for revenue mix and the transition to RSC?
The filing says the transition of existing customers to Rubrik Security Cloud, along with the shift in sales of Rubrik-branded Appliances to contract manufacturers, will limit and cause fluctuations in revenue growth through fiscal 2027. Some customers may use a transitional CDM license, under which a portion of revenue is recognized upfront.
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