Good morning and welcome to our earnings conference call. Before we begin, I'd like to remind you that statements made on today's call will include forward-looking statements about Commvault's future expectations, plans, and prospects. All such forward-looking statements are subject to risks, uncertainties, and assumptions. Please refer to the cautionary language in today's earnings release and Commvault's most recent periodic reports filed with the SEC for a discussion of the risks and uncertainties that could cause the company's actual results to be materially different from those contemplated in these forward-looking statements. Commvault does not assume any obligation to update these statements. During this call, Commvault's financial results are presented on a non-GAAP basis. A reconciliation between the non-GAAP and GAAP measures can be found on our website. Thank you again for joining us. Now I'll turn it over to our CEO Sanjay Mirchandani for his opening remarks. Sanjay.

Thanks, Mike. Good morning, and thank you for joining today's call. Q2 was an exceptional quarter with momentum once again accelerating across all our primary KPIs. During the quarter, total revenue increased 16% to $233 million, our fourth consecutive quarter of double-digit revenue growth. Total ARR accelerated 20% to $853 million, Subscription ARR rose 30% to $687 million. SaaS ARR jumped 64% to $215 million and now represents 25% of our total ARR. And free cash flow grew 34% to $54 million, with 97% of that free cash flow returned through share repurchases. It has never been clearer that what we do matters. In an age of nonstop threats and cyber-attacks, organizations need to be ready. And once that moment comes, they need to be able to quickly recover without missing a heartbeat. This is even more important in the cloud-first world that we live in today. Let me say more on that. IDC reported that 73% of all new data will be stored in the Cloud and that spending on public Cloud services is expected to double in the next four years. However, traditional static approaches to business continuity and outdated point solutions are grossly inadequate for today's dynamic digital cloud-first enterprises. This is why we've been innovating and re-envisioning a world we call continuous business, where resilience and security are implicit. It is built on three fundamental principles. First, to be truly resilient organizations must own their cloud-first environment and be able to scale it, shrink it, manage it, and secure it any way they want. After all, if their business is in the cloud, then keeping their cloud resilient is their business. Next, multi-cloud is not universal. So, customers need agility, diversity, and portability across clouds to reduce lock-in, improve redundancy, and embrace scalability to meet their business needs. And third, one size does not fit all in today's dynamic environment. So, their platform seamlessly enables resilience across all its cloud environments, regions, accounts, applications, and workloads and manages it all with a true single pane of glass. Commvault Cloud is the only platform that can do all of this while providing the breadth to support the broadest workloads, clouds, and applications, as well as the depth to go deep with cloud-first recovery capabilities. At our Shift event earlier this month, we announced our next generation of cloud-first technology innovations and partnerships to offer new states of all this business availability and Cyber Resilience for the modern cloud-first enterprise. While many competitors are playing catch up in terms of the workloads we support, we introduced Commvault Cloud Rewind, a truly unique offering that transforms and simplifies recovery of the cloud. This technology integrates capabilities from our Appranix acquisition and leverages automation to enable customers to discover, map, and recover not just their data, but their cloud applications often in minutes. Cloud Rewind also works across clouds, so breadth is the name of the game. We're hearing great things from our customers. Frontale, a company steeped in e-discovery and digital forensic investigation, noted that 'New capabilities like resource discovery, dependency mapping, and cloud reconstruction not only ensure our data is safe but also pave a clear path to recovery. With Cloud Rewind's simple and efficient cloud dashboard, recovery is quick and reliable, drastically reducing cyber recovery complexity. These advancements are just one more reason we trust Commvault with our cloud. In addition, we announced that our platform will help automate the manual and error-prone process of recovering active directory from a ransomware incident. Active Directory is the anchor around which modern identity access management architectures are built. It is often targeted by bad actors because it controls access to an organization's most critical assets. Commvault Cloud will automate and orchestrate the complex steps required to recover and configure Active Directory from a previous such state to improve cyber resiliency. We expect to release an enhanced Active Directory offering shortly. We also announced at Shift, deep integrations and expanded relationships with strategic cloud partners, AWS and Google Cloud. We're bringing the breadth of the Commvault Cloud Cyber Resilience platform to AWS customers. And with our recent Clumio acquisition, we're bringing innovative recovery capabilities to Amazon S3. This depth is paramount as many organizations rely on S3 to store large data and growing data sets. With Google Cloud, we're offering comprehensive data protection and Cyber Resilience capabilities to Google Workspace customers. This includes Gmail, Google Drive, and shared drives; no email left behind. And all of this, of course, complements what we already do today with Microsoft Azure and Oracle Cloud. Our multi-cloud strategy is simple: meet customers where they are and give them the cloud-first resilience capabilities they need for continuous business. And we're serious when we say no workload, no cloud, and no application left behind. For example, Constellation Energy, the nation's largest producer of clean emissions-free energy, chose our Commvault Cloud platform to advance their Cyber Resilience capabilities, enhance operational efficiency, and further address regulatory requirements across its multiple clouds and on-premise environments. This quarter, we also teamed up with Pure Storage to help financial services customers meet stringent compliance regulations, starting with the EU's DORA regulation that takes effect in January 2025. Our joint offering is focused on two critical areas: first, risk management, including protection, detection, response, and recovery. Second, operational tests. Together with Pure, we deliver the ability to continuously test Cyber Recovery into secure isolated environments like Clean Room. In closing, our unique approach to Cyber Resilience is resonating in the market. Our ability to democratize cloud and on-prem workloads natively has allowed us to land new customers and expand with our existing base, be it SaaS or software. All of this gives us confidence that we can continue to deliver solid financial results. With that, I'll introduce our new CFO, Jen DiRico. Jen, we're happy to have you on board. Over to you to discuss our results and outlook for fiscal year '25.

Thank you, Sanjay. It's great to be here, and thanks to the entire Commvault team for the warm welcome. I knew I was joining a great company. But in the few short months I have been here, it is clear that the team has created something extraordinary. I'm excited to be a part of this. It's also been great to partner closely with Gary during the transition as well as the rest of the leadership team. As Sanjay shared, Q2 was a record quarter across all parts of our business. Our Commvault Cloud platform is resonating as enterprises now more than ever need to be resilient. This results ahead of the high end of our guidance across all key metrics and give us confidence in our ability to seize the opportunities ahead. Today, I will share our Q2 results and operating metrics, and then provide our guidance on Q3 and FY '25. As a reminder, all growth rates are on a year-over-year basis unless otherwise noted. Our differentiated Commvault Cloud platform continues to gain momentum, especially with the cyber challenges enterprises are facing today. In Q2, we continued to see an acceleration in the monetization of our cyber resiliency offerings. That, combined with field execution resulted in total revenue growth of 16% to $233 million. This was led by a 37% increase in Subscription revenue. We are proud to deliver our fourth consecutive quarter of double-digit total revenue growth. Growth in Subscription revenue came from both increased contributions from our SaaS portfolio and continued double-digit growth in term software licenses, well ahead of the market growth rate. The contribution from our term software transactions exceeding $100,000 increased by 23% and benefited from a 12% increase in the average deal size. This expansion reflects a healthy sales mix of our autonomous and Cyber Resilience bundles. Q2 customer support revenue, which includes support for both churn-based and perpetual software licenses, grew 1% to $78 million. Customer support revenues derived from term software and related arrangements now represent 54% of customer support revenue, up 800 basis points compared to only 46% in Q2 of the prior year. Q2 total ARR growth accelerated 20% to $853 million. Subscription ARR encompassing term-based licenses and SaaS contracts, increased by 30% reaching $687 million or 81% of total ARR. This includes $215 million in SaaS ARR, which increased 64% year-over-year, continuing along its hypergrowth trajectory. During the quarter, we added approximately 600 new subscription customers and have now surpassed 10,000 subscription customers worldwide, including over 6,000 SaaS customers. In our existing customer base, we continue to see strong trends in multi-product adoption. For example, we closed a significant deal with an international energy provider for Cleanroom Recovery, Air Gap Protect, as well as protection for their VMs, Kubernetes, and M365 Instance. Existing customer expansion remained healthy with a Q2 SaaS net dollar retention rate of 127%, driven by both upsell and cross-sell. SaaS ARR saw notable growth from emerging products such as Cleanroom Recovery, ThreatWise, and mission-critical offerings, including Active Directory. These trends continue to support our confidence for further expansion opportunities with the newest products we announced at Shift. As we think about our future growth opportunities, we recognize the importance of making key strategic investments while continuing to demonstrate our responsible growth philosophy, and this quarter was no different, evidenced by our outperformance against both our total revenue and profitability targets. In fiscal Q2, gross margins improved 20 basis points year-over-year to 82.2% as we continue to drive leverage in our SaaS hosting costs. Operating expenses increased 17% to $143 million, reflecting our planned investments to accelerate revenue momentum as well as an increase in commission and bonuses due to record revenue growth. Non-GAAP units grew 14% to $48 million, below our 16% total revenue growth, consistent with our philosophy to drive operating leverage in the model. Non-GAAP EBIT margins were 20.5%, 100 basis points higher than the midpoint of our guidance. Now moving to some key balance sheet and cash flow metrics. We ended the quarter with no debt and $303 million in cash. As we continue to invest in our future, we remain opportunistic around technologies that further the depth and breadth of our platform. On October 1, we closed our previously announced acquisition of Clumio for approximately $47 million, funded with cash from our balance sheet. We are several weeks into integration, and Sanjay and I look forward to providing an update on our Q3 earnings. Our Q2 free cash flow grew 34% to $54 million, reflecting continued growth in SaaS deferred revenue and the strength of our Software Subscription business, which typically includes upfront payment on multiyear contracts. In Q2, we repurchased $52 million of stock representing 97% of free cash flow. Fiscal year-to-date through September 30, 2024, we repurchased $103 million of stock, representing 106% of free cash flow. We plan to repurchase at least 75% of our free cash flow for the full fiscal year. As we reflect on the strength we saw in the first half of fiscal '25 and the positive customer reactions to our new operative Shift, we are pleased to share our outlook for fiscal Q3 and once again raise our guidance for fiscal year '25. For fiscal Q3, we expect Subscription revenue, which includes both the software portion of term-based licenses and SaaS, to be in the range of $143 million to $147 million. This represents 27% year-over-year growth at the midpoint. We expect total revenue to be in the range of $243 million to $247 million, with growth of 13% at the midpoint. At these revenue levels, we expect Q3 consolidated gross margins to be in the range of 81% to 82%. Gross margins reflect modest solutions from the acquired Clumio assets. Even with incremental costs of the Clumio acquisition and our customer event lending, we expect Q3 non-GAAP EBIT margins to remain in the range of 20% to 21%. Our projected diluted share count for fiscal Q3 is approximately 45 million shares. With the strong results we've done in the first half and the demand we see moving into Q3, we are once again raising our outlook for the full fiscal year '25. We now expect fiscal year '25 total ARR growth of approximately 18% year-over-year. We expect Subscription ARR to increase in the range of 26% to 28% year-over-year. From a full-year fiscal '25 revenue perspective, we now expect Subscription revenue to be in the range of $552 million to $557 million, growing 29% at the midpoint with strong contributions from both term software licenses and SaaS. We now expect total revenue growth to accelerate and be in the range of $952 million to $957 million, an increase of approximately 14% at the midpoint. Moving to our updated full year fiscal '25 margin, EBIT and cash flow outlook. We continue to expect gross margins to be approximately 81.5% to 82.5%, inclusive of the accelerating contribution of our SaaS business. We also continue to expect non-GAAP EBIT margins to be in the range of 20% to 21%. From a free cash flow perspective, we expect full-year free cash flow to exceed $200 million. Lastly, we are currently trending ahead of the targets that we originally shared for FY '26. In closing, we are proud of our execution and momentum through the first half of 2025. We are on track for a strong second half of the year and are well positioned to see the market opportunities ahead. Now I will turn it back to the operator to open the line for questions.

Thank you; we will begin the question-and-answer session. Your first question comes from Aaron Rakers from Wells Fargo. Your line is open.

Yes, thank you very much. Thanks for taking the questions. I have a couple here real quick. And first of all, congrats on the continued very strong results, very impressive. I guess my first question is, when we look at the Subscription business and in particular the SaaS business, I'm curious if you could unpack a little bit the upsell and maybe cross-sell motion that the company has been seeing. Any changes in this last quarter? I think a couple of quarters ago or so, you've given some metrics around that ability to have the SaaS business and cross-sell into the core storage management platform. So, any kind of updated metrics around that would be great.

Hey Aaron, it's Sanjay. Thanks. I'm going to hand this over to Jen, our new CFO. I just wanted to welcome her on the call, and I'm going to hand it over to her to answer the question.

Thanks, Aaron, for the question. And thank you, Sanjay. So, our SaaS ARR is over $250 million this quarter and is a record for us, and we're excited about that. The momentum that we're seeing in our SaaS ARR really comes down to the continued execution from the sales team as well as the fact that our net revenue retention rate was 127%, right? And that's driven through a combination of upsell and cross-sell, that would be breaking down by one third cross-sell and two thirds upsell. We are continuing to see traction in our Cyber Resilience products, and we’re excited about the new products we’re launching. I would say, overall, our emerging workloads are really picking up momentum and we’re excited about what we’re seeing.

Yes. Workloads like ThreatWise, workloads like Active Directory, Cleanroom—these have all been launched in the past, I don't know, let's say, six to 12 months and are really seeing proof of concept and being deployed. So, those are kind of emerging workloads.

Yes. And then a quick follow-up question. You mentioned, obviously, the relationships with AWS and Google on the call. But one other relationship I’m curious about is how are we thinking about the alignment with Dell? And I think in particular, with maybe the data domain platform, any update on how that relationship's evolved and whether or not we should think about that as being an incremental contributor to growth as we look out over the next couple of quarters. Thank you.

Sure, sure. Just on the AWS and Google, it's building on what we've already got. And with AWS, it's bringing some of our core platform capabilities based on customer demand in true multi-cloud environments. The Clumio acquisition also underscores our commitment to making sure that we've got the best-of-breed capabilities on all major clouds. With Google, it was support for Google Workspace. We've been on this for a while, building this out to bring the capabilities we have on the Microsoft 365 at that level. So, now we've got both major suites completely covered. Again, these are all incrementally growing our existing partnerships. The bit around the Dell data domain and our partnership, if you would, is a work in progress. When we announced it, Aaron, I was very clear that this is not a short-term thing. Taking out entrenched incumbents needs an overall strategy, need Cyber Resilience end-to-end, and that's exactly the kind of wins we're having. This is a work in progress. We're working together. It's moving along well. We've got lots of good stuff happening, but I'm not putting out a number in any way around that specifically.

Yep, fair enough. Thank you, guys.

Thank you. Our next question comes from the line of Rudy Kessinger from D.A. Davidson. The line's open.

Hey guys, thanks for taking my questions and I'll add my congrats to another very strong quarter. The SaaS ARR is obviously highly impressive. I think equally as impressive or certainly interesting is the growth on your term license ARR has accelerated the past couple of quarters. Some of your competitors are pretty much ignoring the on-premise segment of the market at this point. Could you just talk about the competitive landscape there in the on-premise segment of the market and just the opportunity there and what you're seeing from a legacy displacement standpoint?

Absolutely. Rudy, Sanjay. First and foremost, we've said this—I've said it as long as I've been here, it's a hybrid world. And on the cloud side, it's truly multi-cloud now, and we're pivoting to say cloud first. In other words, it doesn't matter if the workload in some ways runs in the cloud or as a SaaS workload, your data has a high propensity to land in the cloud. So, having first-class capabilities on any cloud being truly multi-cloud matters. That does not preclude the fact that on-premise capabilities continue to grow. Okay? And we are, I think, the broadest set of capabilities, and we have a platform advantage on-premise. Now from the days of Metallic, when we launched Metallic, I'll take you back a little bit, it wasn't so long ago; we talked about one platform, whether it's a SaaS workload, whether it's a cloud workload or an on-premise workload, you get one pane of glass because workloads should be able to move freely based on customer requirements. That strategy, if anything, has held us in good stead, and we are best-in-class because customers don't have to make unnatural choices between a workload living here or living there on one cloud or the other. With our platform, you get seamless portability across your workloads. And we're continuing to invest in our on-premise capabilities. We announced a bunch of features and capabilities on this at Shift a couple of weeks ago. And as you can tell, it's not at the cost of cloud.

Yes. Got it. That's helpful. Jen, if I look at the guide here, in the first half, your net new ARR growth was 93% year-over-year. It's implied at down mid-single digits in the second half, even lower than that organically if we assume some contribution from Clumio. Was there any large pull forwards or early renewals that contributed in the first half? Or just how does the second half pipeline look relative to the first half? Just trying to pair what looks like a very, very conservative second-half guide versus what you just put up in the first half.

Thanks for the question, Rudy. And I would just reiterate, we're really, really proud of the execution that we saw in the first half of the year. It really does a testament to not only what we're seeing from a product perspective, but overall execution to the sales team. As we think about the second half of the year, you may have seen in our press release that we had about a 1% FX benefit from our revenue. On an ARR basis, that equates to a couple of points. And so, as I think about it as my first quarter as CFO, I would continue our responsible growth strategy and also the guidance philosophy that the management team has already put into place. And so, if you take a look back over the prior four quarters, we're averaging about $29 million in ARR on average, there's fluctuations to that number. And I think what you'll see is our second half of the year guidance is consistent with that.

That's helpful. Thank you and congrats again, guys.

Thank you. Our next question comes from the line of James Fish from Piper Sandler. The line's open.

A couple of questions here. I know you don't break out with an international exactly between APAC and EMEA. But EMEA—let's call it—has been pretty decent. Obviously, U.S. was really strong this quarter based on your disclosures; our Americas was. Is there any way to understand what you guys are seeing at this point for pipeline related to DORA specifically in EMEA?

Hey there. It's Sanjay. So, with DORA, there's been a lot of work—we've been doing a lot of work leading up to the regulation, which I think kicks in in January. And we've been working on our own platform, building regulatory and compliance capabilities, but also partnering with others, whether it be systems integrators who are actually implementing the systems for customers have been implementing customers that will continue to or with partners like Pure, where between that platform and our—we're bringing sort of engineered capabilities for DORA compliance out of the box. So, we think DORA has been contributing between Europe to our business and will continue to as customers roll out the full breadth of what's required.

Got it. And then, Jen, for you. Building off of Rudy's question a little bit here. Can you just unpack on the guide raise? How much of it is what you guys are seeing in terms of, call it, ELAs or consolidation platformization coming in this year versus I think people are missing that Appranix was helpful in fiscal Q1 as just a reminder, as we think about in fiscal '26, but how much is coming in for Appranix and Clumio on the ARR side this year?

Yes. Thanks for the question. Like I said before, we are really proud of the momentum we're seeing in our organic business. And the strength of that came through in the first half of the year. As we think about the second half of the year, we are excited about our— the acquisitions we've done. Clumio, in particular, was very much an acquisition for us to broaden the technology and increase the talent here at Commvault and continue to accelerate our innovation and needs for customers. As I look to the second half of the year from a guidance perspective, most of this is organic. We could share that Clumio was accretive, but it's not material. And so, as you think about the impact in the second half of the year, it's a few million dollars per quarter. But again, I would point you back to the strength of the business from an organic perspective.

And we're in the throes of literally, it's been a few weeks. So, we're in the throes of actually starting the integration process with the Clumio team, and we're very hopeful that this thing will get integrated quickly. And the customers will get consolidated and expand nicely. With the Appranix, we've had a few more months of a head start. And with Cloud Rewind, which we announced a couple of weeks ago, which is a rebranded version of Appranix, we've already got new customers, and we've got a very healthy deadline that's lining up. Again, this isn't a carryforward piece. This is all organic. I consider it organic as it's now part of the family.

Yep, makes sense. Guys, thanks.

Thank you. Our next question comes from the line of Jason Ader from William Blair. The line is open.

Thanks. Good morning, guys. A couple of quick ones. On the revenue side, did you disclose the growth rate there? I don't know if that's something that you're doing every quarter. But if not, it would be great to get that.

We don't disclose that right now. We focus on the software or the overall software number, which the software number this quarter grew 37% on Subscription.

Okay. And then just as it thinking about operating margin outlook, I understand there's some—the acquisitions that you've done. We're talking about—you guys are about to hit $1 billion in revenue running at 20%—20% to 21% operating margin. How do you feel about that number? I mean, from a kind of at-scale software companies, that seems low to me. What are your thoughts on kind of where that goes over time? And how do you get there?

Yes. Great question. Thank you. I would say if we do know, we are committed to responsible, profitable growth. In 2025, we have shared that we are investing to accelerate our growth and capture market share. All at the same time, we are working to ensure that we increase leverage within the business. You saw that this quarter in the past, and ultimately, we're committed to doing both of those things across, and we will continue to expand margins over time, while also accelerating the growth, and I would just point you back to the guidance that we shared today for FY '25.

Just I've been saying this for a while that there is a platform consolidation required in the industry. Just over the years, there have been too many big part programs. There have been too many best-of-breed capabilities that have been inserted into enterprises, which—and I think I've said—I said last quarter, I'd say again, in this case, more is not necessarily better. And so having an end-to-end capability that really allows you to see every single workload, every application, and every cloud and one pane of glass is the right approach. Now—it's a journey. This is not easy. We've been in business for 20 years or 15 years or 10 years. You've got a little bit of everything and for customers to really make that call and do that migration needs time and decisions. And our platform is deeper suited. That is exactly how we win. No workload left behind. And now we've gone further to say no application and no cloud left behind. We're changing the dynamics because we were the data guys. We are the data guys. We would always say, we'll bring your data back, and then the customer has to go bring the rest of it back. Now we're saying, it's a hard science problem even from that point on, and we want to be part of that. And we're helping—so if you look at the Appranix capability. And if you look at some of the ambition we have around Clumio, that's exactly where we're going to go, we're going to go the entire distance, and one platform allows customers to do any workload, any cloud, any application whether it starts on-premise, on the edge, or in the cloud and wants to move between them. So, that's been our stated direction. And we are putting every ounce of engineering energy we've got into that.

Thank you.

Thank you. Our next question comes from the line of Howard Ma from Guggenheim. The line's open.

Thanks. And I want to add my congratulations as well on the exceptionally strong results. I want to ask, I guess, for both Sanjay and for Jen, what is driving the strength in your on-premise Subscription business? And when we think about the upside in the quarter, the Q2 upside and the raised full year forecast, how much of that is renewal timing because you have more one-year deals now up for renewal? Or is it not that? Is it primarily due to workload expansions and new logos, and if it is new logos, where is the market share? Where are the gains coming from? Because I would think that with the acquisition of Veritas by Cohesity in your new partnership with Dell, there's—I would think there's less to win going forward from the two biggest share builders?

It's the latter. It's Sanjay here. Good to hear from you. It's the latter. We're taking share. We're taking share because of the—my earlier response because of the breadth of our platform because we democratize the fact that the workload could start anywhere and anywhere and live anywhere. And we protect it all the way. Now, the market, if you look at the traditional on-premise market and depending on who survey you look at, it's flat to low single digits of growth, mostly flat. So, if we're growing the way we're growing and have been for the past many quarters, we're taking share from incumbents and we're an enterprise player at heart. So, am I taking share from Veritas Cohesity? Absolutely. Am I taking share from some of the other incumbents? Absolutely. And we continue to do that because our platform breadth is second to none. That's how we win. Now subscription versus nonsubscription we lead with subscription. That's what the sales force leads with if it's an on-premise sale.

Got it. Thank you for the directness. I just have a quick follow-up. When we think about the contribution of Clumio and Appranix, which Jen just shared some details on, if we think about the seasonality for net-new ARR in the SaaS business, should that result in more acceleration this year in the back half than last year?

You want to repeat the question?

Yes. Can you repeat the question?

So, the question is should we expect more acceleration in a SaaS net new ARR in the back half of this year versus last year, considering that the increased contributions from Clumio and Appranix?

Yes. Great question. I think as it relates to the second half of the year guidance, right, the seasonality, the uptick is already implied in the guidance that we've given. And I would just go back to my second half answer around the fact that on average, over the last four quarters, we've seen about $29 million in net new ARR per quarter. And I think that's the right number for us for our model.

And what I would add is we see the Appranix pipeline being built up because they've been in the family now for a few months, and the product has been integrated into Commvault Cloud. We expect to see the same process go through with Clumio. And I think you'll see more of the impact in fiscal year '26.

Got it. Great. Thanks so much.

Seeing as there are no more questions in the queue, that does conclude our question-and-answer session. I will now turn the call back over to the Commvault team for closing remarks.

Thanks, everyone, for joining our call today. If you need any additional information, please review our investor presentation on the Investor Relations website. We look forward to speaking with you. Thank you.

Ladies and gentlemen, that concludes today's call. Thank you all for joining. You may now disconnect.