Rubrik's prior Q424

Investment Analysis Clubs Saul’s Investing Discussions
1

I wrote up Rubrik’s Q424 results from March in my service. I see a lot to like. They have had a +88% bounce back off of YTD lows, and are now at all time high.

They announce Q1 on Thursday, as does Samsara.

  • Revenue growth again accelerated, having gone from +29% to now +47% over the last year.
  • FY26 guidance was initially set at +31%. This is well above the current guides from other next-gen security players, showing how important resiliency & data security has become.
  • Cloud ARR continues to shine, growing +66.9% to now be over 80% of Sub ARR – after adding a record +$107M in net new.
  • Sub ARR growth is a more muted +39%, as self-managed subs continue to transition to cloud hosted (cannibalization). Mgmt noted it also had a +2pp from license to sub transitions as well.
  • They continue to make massive strides in profitability, and swung positive in Sub ARR Contrib Margin and TTM FCF way earlier than expected (said would be in FY26 last Q).
  • They are now at a Rule of 44 in TTM FCF.

impressive top line

  • Revenue was $258.1M, accelerating to +47.5% YoY, or a strong +9.3% seq. They beat their sandbagged guide (-1.1% seq) by 10%.
  • Subscription revenue was $243.7M, growing +53.6% or +10.0% seq.
  • International revenue accelerated from +35% to now +47% this Q .
  • Q1 was guided to +39.3%, or a weaker +1.1% seq.
  • FY26 was guided to a strong $1161M in revenue, for +31% growth.

big improvements to bottom line

  • Gross margin rose +2pp to 79.7% (near their record of 80.2% right before IPO).
  • Op margin rose +33pp to -11.3%, with TTM rising +22pp to -24.4%. (Yes, TTM margins nearly halved over the past year.)
  • Sub ARR Contrib margin rose +14pp to 2%, swinging positive.
  • FCF margin was a record 29.2%, with TTM rising +6pp to 2.4%, swinging positive.
  • They are hitting Rule of 40 TTM. They hit Rule of 77 this Q from that strong FCF, finally making Rule of 40 TTM rise from 31 to 44 sequentially – vs being at Rule of 1 last year!

land and expand looks healthy

  • Customers>$100K grew +29% to 2246, from a strong +161 net new. (Q4 looks seasonally strongest here.)
  • ARR of large customers grew to 84%, implying large customers are growing ARR faster at +46% vs +39% overall.
  • Customers>$1M grew +64% to 162.
  • NRR remained over 120%.
  • NPS is reported at >80 (top tier in customer satisfaction).

-muji

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