01—Abstract
Summary
Summary of the 10-Q filed September 12, 2024. Cited figures are marked; the original filing is the authoritative source.
Rubrik, Inc. reported revenue of $204.95 milliona for the three months ended July 31, 2024, up from $151.54 million a year earlier, a 35% increase as stated in the filing.
Subscription revenue rose 50% to $191.32 millionb, while maintenance and other revenue declined. Growth metrics were strong: Subscription ARR reached $919.1 million, up 40%, and Cloud ARR reached $677.9 million, up 80%. Customers with $100,000 or more in Subscription ARR increased to 1,969 from 1,463, and the average subscription dollar-based net retention rate was over 120%.
Profitability remained negative. The net loss was $176.9 millionc for the quarter and $909.0 million for the six months ended July 31, 2024. The six-month results include $735.3 million of stock-based compensation, recognized largely after the company's April 2024 initial public offering at $32.00 per share.
Gross margin fell to 73% for the quarter from 77% a year earlier. Net cash used in operating activities was $58.5 milliond for the six months, and free cash flow was $(69.1) million, which the company attributes partly to $22.8 million of employer payroll taxes tied to IPO-related equity vesting. Cash, cash equivalents and short-term investments totaled $601.3 million, and the accumulated deficit was $2,591.5 million.
The filing also highlights risks for investors. Dual-class voting gives Class B holders about 97% of voting power, and the company discloses an ongoing Department of Justice investigation tied to government contracts, for which it cannot estimate potential consequences. The company says the transition of existing customers to its Rubrik Security Cloud platform will cause revenue fluctuations through fiscal 2027, and it has a $330.0 million amended credit facility maturing in August 2028.
02—Key points
Key Highlights
- Total revenue of $204.95 million for the quarter ended July 31, 2024, up 35% from $151.54 million, with subscription revenue up 50%.
- Subscription ARR of $919.1 million, up 40%, and Cloud ARR of $677.9 million, up 80%.
- Customers with $100,000 or more in Subscription ARR rose to 1,969 from 1,463, up 35%; average subscription dollar-based net retention rate was over 120%.
- Net loss of $176.9 million for the quarter and $909.0 million for six months, including $735.3 million of six-month stock-based compensation after the IPO.
- Free cash flow was $(69.1) million for the six months; cash, cash equivalents and short-term investments were $601.3 million.
- Remaining non-cancellable performance obligations were approximately $1,513.0 million, with 48% expected to be recognized over the next 12 months.
- Holders of Class B common stock hold about 97% of voting power; a Department of Justice investigation related to government contracts is ongoing.
03—One dollar
Follow one dollar
For each $1.00 of revenue in Q2 FY2025, Rubrik lost $0.86.
- Revenue$205.0M100.0%
- Cost of revenue−$55.2M26.9%
- Gross profit$149.8M73.1%
- Operating costs−$318.1M155.2%
- Operating income−$168.3M82.1%
- Interest, other & tax−$8.6M4.2%
- Net income−$176.9M86.3%
04—Financials
Financial Highlights
Figures from 10-QQ2 FY2025filed September 12, 2024Financial Statements
Q2 FY2025 against Q2 FY2024
| Line item | Q2 FY2025Q2 FY2024 | Change |
|---|---|---|
| Revenue | $204.95M$151.53M | +35.2% |
| Cost of Revenue | $55.17M$35.39M | +55.9% |
| Gross Profit | $149.78M$116.14M | +29.0% |
| R&D Expenses | $86.23M$49.76M | +73.3% |
| Operating Expenses | $318.08M$189.66M | +67.7% |
| Operating Income | -$168.29M-$73.52M | −128.9% |
| Interest Expense | $10.24M— | — |
| Net Income | -$176.93M-$81.12M | −118.1% |
| EPS (Basic) | $-0.98$-1.35 | +27.4% |
| EPS (Diluted) | $-0.98$-1.35 | +27.4% |
| Shares Outstanding (Basic) | 179.85M60.30M | +198.3% |
| Shares Outstanding (Diluted) | 179.85M60.30M | +198.3% |
05—Questions
Frequently Asked Questions
How fast is the company's recurring revenue growing?
Subscription ARR was $919.1 million as of July 31, 2024, up 40% from $655.0 million a year earlier, and Cloud ARR was $677.9 million, up 80% from $376.8 million. The filing notes that about 2.5 percentage points of Subscription ARR growth came from transitioning existing maintenance customers to subscription editions.
Why did net loss increase so sharply in the six months?
The six-month net loss of $909.0 million compares with $170.4 million a year earlier. The filing attributes the increase largely to $735.3 million of stock-based compensation, including RSU expense recognized after the IPO, along with higher sales and marketing and research and development spending.
How is the company funding itself and what debt does it have?
The company had $601.3 million of cash, cash equivalents and short-term investments as of July 31, 2024. It received net IPO proceeds of about $710.3 million and about $104.9 million from the over-allotment option. Its Amended Credit Facility provides up to $330.0 million, consisting of a $289.5 million term loan and $40.5 million of delayed draw term loans, maturing August 17, 2028. The company also paid $430.3 million in taxes related to net share settlement of equity awards.
What are the main risks disclosed in the filing?
Key risks include a history of operating losses, revenue fluctuations as customers transition to Rubrik Security Cloud through fiscal 2027, reliance on third-party cloud providers, and competition. The company also discloses that holders of Class B stock control about 97% of voting power, and that a Department of Justice grand jury investigation related to government contracts is ongoing, with no estimate of possible consequences.
06—Continue