Q2 2025 Earnings Summary
- Robust Financial Growth and Raised Guidance: Rubrik achieved strong financial performance with Subscription ARR growing 40% year-over-year to over $900 million and Subscription Revenue growing 50% year-over-year, leading to raised full-year guidance and confidence in the outlook based on a strong pipeline and execution.
- Unique and Comprehensive Platform Driving Competitive Wins: Rubrik's unique architecture combines Data Security Posture Management (DSPM) with cyber recovery capabilities, providing comprehensive cyber resilience solutions across over 20 applications, including cloud, SaaS, and on-premises workloads. This has led to winning the vast majority of deals against both legacy and new-gen competitors, and the company sees opportunities to gain market share amid competitors' uncertainties.
- Strong Market Demand and Strategic Positioning in a Growing Market: Cyber resilience is a top priority for organizations globally, driving demand for Rubrik's solutions. The company is engaging more with CISOs, seeing strong adoption of its Enterprise Edition and DSPM solutions, and has strategic partnerships (e.g., Microsoft Healthcare Partner of the Year) positioning Rubrik favorably in a large and growing market.
- The company acknowledges an uncertain macroeconomic environment, which could impact future growth. CFO Kiran Choudary stated, "there is still an uncertain macro environment, and we are being prudent and thoughtful with the guidance."
- Potential intensified competition due to industry consolidation could pose challenges. The merger between Veritas and Cohesity may strengthen competitors' market position. While CEO Bipul Sinha sees it as an opportunity, there's a risk that "customers will naturally ask what else exists out there in the marketplace," possibly increasing competition.
- Sustaining high growth rates may become more challenging as the company scales. CEO Bipul Sinha mentioned, "we are already coming up to a $1 billion ARR... I'm thinking about $3 billion as the next major milestone and beyond... what are the things that we need to put in place to continue to grow the business at high speed."
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Margin Improvement Drivers
Q: Where will we see margin leverage moving forward?
A: Kiran said they've made significant progress on margins, with subscription ARR contribution margin improving by 240 basis points quarter-over-quarter and by 1,600 basis points year-over-year excluding IPO payroll tax impact. Efficiency is being driven in sales and marketing through increased productivity, leadership development, and better ROI in growing markets. R&D efficiency comes from leveraging global R&D centers. -
Guidance Confidence and Outlook
Q: What's your confidence level and key assumptions for second half guidance?
A: Kiran expressed confidence due to strong momentum and double-digit net new ARR growth in the first half, which led them to raise second half net new ARR guidance by over 5%. Despite an uncertain macro environment, they feel confident based on their pipeline and execution ability. -
Impact of CrowdStrike Outage on Demand
Q: How is the CrowdStrike outage affecting customer views on cyber resilience?
A: Bipul noted that cyber resilience is now top of mind globally, with the CrowdStrike event highlighting vulnerabilities and prompting Board-level discussions. Rubrik's subscription ARR grew 40% year-over-year to over $900 million, reflecting increased demand. They believe this will drive further market momentum. -
Veritas-Cohesity Merger Impact
Q: Will it be harder to win over Veritas customers after the Cohesity merger?
A: Bipul believes the merger prompts customers to reassess options. With concerns over roadmap stability, Rubrik sees this as an opportunity, already observing increased customer inquiries and winning the majority of deals against competitors. -
DSPM Growth and Competitive Landscape
Q: How is your DSPM product performing amid increased competition, and does the Salesforce acquisition affect your advantages?
A: Bipul stated they have over 50 DSPM customers and view DSPM as integral to their strategy, especially with the rise of generative AI. The Salesforce acquisition validates their approach, as businesses seek a single policy engine across applications. -
Strategic Initiatives for Future Growth
Q: What strategic initiatives are in place to sustain or accelerate growth?
A: Bipul is aiming for $3 billion ARR as the next milestone, focusing on high-speed growth, scaling, and diversifying products. He emphasizes the importance of strategic vision to avoid stagnation. -
TCO Benefits from Consolidation
Q: What TCO benefits are customers seeing from consolidating to Rubrik?
A: Bipul explained that customers see over 25% TCO savings when fully adopting Rubrik. They consolidate multiple tools into their platform, including data protection and security across cloud and data center. -
Mandiant Partnership and Cloud Strategy
Q: How does the Mandiant collaboration enhance penetration in Google Cloud, and any plans for AWS?
A: Bipul highlighted that the Mandiant partnership delivers complete threat intelligence and recovery on Google Cloud. They aim for multi-partnerships across Microsoft, Google, AWS, and others to deliver cyber resiliency across platforms. -
Healthcare Vertical Strategy
Q: How is Rubrik addressing unique healthcare challenges, and how is the Microsoft partnership central to this vertical?
A: Bipul noted that healthcare organizations have 3x more sensitive content, making them prime cyberattack targets. Rubrik offers comprehensive solutions to keep hospitals operational, with partnerships like Microsoft strengthening their position. -
Ruby AI and Generative AI Impact
Q: How is Ruby AI usage developing, and what's its impact on your offerings?
A: Bipul described Ruby as Rubrik's generative AI agent included in their enterprise edition, aimed at increasing productivity for IT and security teams. They plan to extend its capabilities but do not monetize it separately.
Research analysts covering Rubrik.