0001943896-25-000030
SEC filingRBRK's Q1 FY26 revenue grew 49% YoY driven by 38% Subscription ARR growth, with subscription gross margin expanding to 80%.
For the three months ended April 30, 2025, total revenue increased 49% year-over-year to $278.5 million, driven by a 54% surge in subscription revenue to $265.7 million. The subscription growth was fueled by a 38% increase in Subscription ARR to $1.18 billion, with 2 percentage points contributed by maintenance customer transitions. Gross profit more than doubled to $218.0 million, yielding a gross margin of 78% versus 49% a year ago. The dramatic improvement was primarily due to a $31.2 million reduction in stock-based compensation expense within subscription cost of revenue, which had been elevated in the prior period due to IPO-related cumulative expense recognition. Operating expenses declined 62% in absolute terms but remained high as a percentage of revenue; research and development, sales and marketing, and general and administrative expenses all decreased significantly due to lower stock-based compensation. The net loss narrowed to $102.1 million from $732.1 million, and earnings per share improved to -$0.53 from -$11.48. Free cash flow turned positive at $33.3 million, compared to -$37.1 million in the prior year, aided by higher collections and disciplined spending.
Subscription revenue accounted for 95% of total revenue, up from 92% a year ago, as the company continues its strategic shift to cloud-based subscriptions. Within subscriptions, SaaS and term-based licenses both contributed to growth; the ratable recognition of RSC revenue and benefits from Subscription Credit exercises supported the increase. Maintenance revenue declined 59% to $2.3 million, reflecting the ongoing migration of legacy perpetual license customers to subscription editions, which is expected to be largely complete by fiscal year-end 2026. Other revenue, primarily professional services, increased 11% to $10.5 million, though its share of total revenue continues to diminish as appliance sales transition to contract manufacturers. Gross margins by segment improved markedly: subscription gross margin rose to 80% (from 57%), maintenance to 82% (from 36%), and other to 22% (from -97%), all benefiting from reduced stock-compensation charges.
Management emphasizes that the business transition from legacy CDM to RSC remains a key driver, with Subscription ARR serving as the primary performance metric. The company expects subscription revenue to continue benefiting from Subscription Credit exercises through fiscal 2026, with the impact diminishing through fiscal 2028. No specific quantitative guidance is provided, but the company anticipates continued investment in R&D, sales, and marketing to capture market share in data security, while targeting long-term improvement in operating leverage. The free cash flow positive quarter is viewed as a milestone, but management cautions that cash flows may fluctuate due to seasonality and payment term mix. The MD&A does not disclose any changes to critical accounting policies or risk factors, which are covered separately.
As of April 30, 2025, Rubrik held $284.0M in cash and cash equivalents and $478.1M in short-term investments, totaling $762.1M in liquidity. The company had $322.8M in noncurrent debt, resulting in a net cash position of $439.2M. Total assets were $1.4746B against total liabilities of $2.0311B, leading to a stockholders' deficit of -$556.5M. Accounts receivable stood at $165.6M (net of allowances), deferred commissions (current and noncurrent) totaled $221.0M, and goodwill was $101.6M. Operating lease liabilities were $41.7M, with right-of-use assets of $38.8M.
The company disclosed total remaining non-cancellable performance obligations of $1.8577B as of April 30, 2025, of which 52% is expected to be recognized as revenue over the next 12 months. Deferred revenue totaled $1.5092B (current $838.9M, noncurrent $670.3M). No material changes to purchase commitments or other contractual obligations were noted outside the ordinary course of business. Operating lease commitments total $46.5M in undiscounted payments, with $9.9M due in the remainder of fiscal 2026.
No share repurchase program or dividends were disclosed. The company made no new debt issuances or repayments during the quarter, with $293.6M in total term loans outstanding (net of $6.9M debt discount). Capital expenditures were $2.9M (1.0% of revenue), primarily for property and equipment. The company also capitalized $3.5M of internal-use software development costs. Cash paid for interest was $9.3M, reflecting the floating-rate term loan.
Rubrik operates as a single reportable segment: software and services. Revenue is recognized primarily from subscriptions ($265.7M), with maintenance ($2.3M) and other services ($10.5M) comprising the remainder. Geographic breakdown: Americas $202.8M (73%), EMEA $64.8M (23%), APAC $11.0M (4%). The United States alone contributed $195.3M (70% of total revenue). Segment net loss was $102.1M, equal to consolidated net loss, driven by $73.5M in stock-based compensation and $311.1M in total operating expenses.