Financial Analysis

"Commitments and Contingencies The Company and certain current and former officers are named as defendants in actions filed by shareholders in May 2026 and June 2026 in the United States District Court for the District of New Jersey. The actions allege violations of the federal securities laws under Sections 10(b) and 20(a) of the Securities Exchange Act of 1934, as amended (the ""Exchange Act"") and Rule 10b-5. The actions seek declarations of the actions as class actions, unspecified monetary relief, and costs and fees. In May 2026, a shareholder derivative action was filed in the same court against certain officers and directors of the Company. The complaint alleges claims of breach of fiduciary duty and violations of Section 14(a) of the Exchange Act on behalf of the Company, and seeks equitable relief, unspecified monetary damages payable to the Company, and costs and fees. Based on the preliminary nature of these proceedings, the outcome remains uncertain and the Company cannot estimate the potential impact, if any, on its results of operations, financial condition, or cash flows. The Company has not recorded an accrual related to these proceedings as of June 30, 2026. Strategic Pricing and Packaging Initiative During the three months ended June 30, 2026, we recorded an expense of $6,500, representing our current best estimate of amounts payable under a performance-based arrangement related to a strategic pricing and packaging initiative. The arrangement also includes p …

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"Debt Convertible Senior Notes On September 5, 2025, we issued $900,000 aggregate principal amount of the Notes, including the exercise in full by the initial purchasers of the Notes of their option to purchase an additional $115,000 aggregate principal amount of the Notes. The Notes were issued pursuant to an Indenture, dated September 5, 2025 (the ""Indenture""), between Commvault and U.S. Bank Trust Company, National Association, as trustee. The Notes are senior, unsecured obligations and do not bear regular interest; however, special interest and additional interest, if any, may accrue on the Notes at a combined rate per annum not exceeding 0.50% upon the occurrence of certain events as described in the Indenture. The Notes mature on September 15, 2030, unless earlier converted, redeemed, or repurchased. The total net proceeds from the offering, after deducting debt issuance costs, was $878,447. Noteholders will have the right to convert their Notes before March 15, 2030 only under the following circumstances: (1) during any fiscal quarter (and only during such fiscal quarter) commencing after the fiscal quarter ending on December 31, 2025, if the Last Reported Sale Price (as defined in the Indenture) per share of our common stock exceeds 130% of the conversion price (as described below) for each of at least 20 Trading Days (as defined in the Indenture) (whether or not consecutive) during a period of 30 consecutive Trading Days ending on, and including, the last Trading D …

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We disaggregate revenues from contracts with customers by geographical region. Our Americas region includes the United States, Canada, and Latin America. Our International region primarily includes Europe, the Middle East, Africa, Australia, India, and Southeast Asia. Three Months Ended June 30, 2026 2025 Americas $ 186,779 $ 170,928 International 127,352 111,050 Total revenues $ 314,131 $ 281,978

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"Stock Plans We maintain the 2016 Omnibus Incentive Plan (the ""2016 Plan""), which authorizes the grant of various equity-based and cash-based awards. During the periods presented, awards granted under the 2016 Plan consisted of RSUs and PSUs. We also maintain the ESPP, under which eligible employees may purchase shares of our common stock through payroll deductions at a discount to market value, subject to statutory and plan limits. Restricted Stock Units RSUs generally vest over service periods of up to three years. The fair value of RSUs is measured based on the market price of our common stock on the date of grant and compensation expense is recognized on a straight-line basis over the requisite service period. Performance Stock Units PSUs generally vest over service periods of up to three years and are subject to the achievement of specified performance or market-based conditions. Performance-based PSUs are earned based on the achievement of predetermined performance objectives, while market-based PSUs are earned based on our total shareholder return relative to a designated market index over the performance period. Depending on actual performance, the number of shares ultimately earned may range from 0% to 300% of target for both performance or market based PSUs. The fair value of performance-based PSUs is measured based on the market price of our common stock on the date of grant. The fair value of market-based PSUs is measured using a Monte Carlo simulation model, wh …

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"Fair Value Measurements Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for such asset or liability in an orderly transaction between market participants on the measurement date. Valuation techniques used to measure fair value should maximize the use of observable inputs and minimize the use of unobservable inputs. To measure fair value, we use the following fair value hierarchy based on three levels of inputs, of which the first two are considered observable and the last unobservable: Level 1 Observable inputs such as quoted prices in active markets for identical assets or liabilities; Level 2 Inputs other than Level 1, that are observable for the asset or liability, either directly or indirectly; and Level 3 Unobservable inputs that are supported by little or no market activity and that require the reporting entity to develop its own assumptions. The carrying amounts of our cash, accounts receivable, accounts payable, and accrued liabilities approximate their fair values due to the short-term maturity of these instruments. Assets and Liabilities Measured at Fair Value on a Recurring Basis The following table summarizes the composition of our financial assets measured at fair value as of June 30, 2026 and March 31, 2026: June 30, 2026 Level 1 Level 2 Level 3 Total Cash equivalents: Money market funds $ 555,369 $ $ $ 555,369 March 31, 2026 Level 1 Leve …

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"Income Taxes Our effective tax rate (""ETR"") was 34.4% and 12.6% for the three months ended June 30, 2026 and 2025, respectively. The increase in ETR as of June 30, 2026 compared to the prior year was primarily due to changes in the mix of our earnings and tax expenses between the U.S. and foreign countries, as well as changes in the tax impact of stock-based compensation."

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Recently Adopted and Recently Issued Accounting Standards There were no recently adopted accounting standards that had a material effect on our consolidated financial statements and accompanying disclosures. The table below outlines recently issued accounting standards not yet adopted that could have an impact to the consolidated financial statements upon adoption. Standard Description Effective Date Effect on the Consolidated Financial Statements (or Other Significant Matters) Accounting Standards Update No. 2024-03 (Subtopic 220-40): Disaggregation of Income Statement Expenses In November 2024, the Financial Accounting Standards Board issued a new standard to improve income statement expense disclosures. The standard requires greater disaggregated information on certain expense captions, as well as disclosures about selling expenses. This standard will be effective for us for our annual period beginning April 1, 2027 and interim periods beginning April 1, 2028, with early adoption permitted. We are currently evaluating the impact of this standard on our consolidated financial statements and disclosures.

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"Restructuring We initiated a restructuring plan in the first quarter of fiscal 2026 (""Plan A"") which was completed in the fourth quarter of fiscal 2026. It was intended to optimize our Business Technology organization. The objective of this plan was to realign the workforce, invest in emerging capabilities, modernize the technology landscape, and streamline operations to operate with greater agility and customer focus. There were no charges incurred for the three months ended June 30, 2026 related to Plan A. For the three months ended June 30, 2025, restructuring charges related to this plan were composed of the following: Three Months Ended June 30, 2025 Employee severance and related costs $ 162 Stock-based compensation 75 Total restructuring charges $ 237 We initiated a restructuring plan in the third quarter of fiscal 2026 (""Plan B"") intended to optimize our cost structure, improve organizational agility, and better align resources with strategic priorities. These restructuring activities encompass workforce reductions, office lease closures, and exit of operations in certain jurisdictions. As of June 30, 2026, the majority of these costs have been incurred and the remaining activities are anticipated to be completed in fiscal 2027. For the three months ended June 30, 2026, restructuring charges related to Plan B were composed of the following: Three Months Ended June 30, 2026 Employee severance and related costs $ 1,185 Stock-based compensation 565 Other costs 646 T …

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"Revenue We generate revenues through subscription arrangements, which include term-based software licenses, term-based support, and SaaS, as well as perpetual software licenses, perpetual support, and other services. Term-based License Term-based license includes revenue from the license portion of time-based subscription arrangements which are deployed on-premise. The revenue from these licenses is typically recognized when the software is delivered or made available for download. Term-based Support Term-based support includes revenues associated with support contracts tied to our term-based software products. Term-based support includes software updates on a when-and-if-available basis, telephone support, integrated web-based support, and other premium support offerings. We sell our term-based support contracts as a percentage of net software purchases. Term-based support revenue is recognized ratably over the contract term, which is typically one to three years. Software-as-a-service (""SaaS"") SaaS includes revenue from time-based subscription arrangements which are delivered through hosted cloud solutions. SaaS revenue is recognized ratably over the contract term, typically one to three years, beginning on the date that the service is made available to the customer. Revenue from usage- or consumption-based arrangements is generally recognized as the services are consumed. Perpetual License Perpetual license includes revenue from the sale of perpetual software licenses. …

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"Segment Information We operate as a single reportable segment as we report financial information, including net income determined in accordance with GAAP, among other measures, on a consolidated basis to our Chief Executive Officer, who serves as the Chief Operating Decision Maker (""CODM""). The CODM uses consolidated net income to make operating decisions, allocate resources, and evaluate financial performance, primarily by monitoring actual results compared to forecasted results, as well as by reviewing year-over-year results and trending historical performance. The CODM also uses net income in competitive analysis by benchmarking to the Companys competitors. The competitive analysis along with the monitoring of actual versus forecasted results are used in assessing the performance of the segment. The CODM reviews significant segment expenses for our single reportable segment. Significant segment expenses include cost of revenues, sales and marketing expenses, research and development expenses, general and administrative expenses, depreciation and amortization, restructuring, and other operating expenses, all of which are presented in our Consolidated Statements of Operations. Other segment items include interest income, interest expense, other income, net, and income tax expense, which are also presented in our Consolidated Statements of Operations. Revenues by geography are based upon the billing address of the customer. All transfers between geographic regions have bee …

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Summary of Significant Accounting Policies Summary of Significant Accounting Policies There have been no changes to our significant accounting policies described in our Annual Report on Form 10-K for the fiscal year ended March 31, 2026 that have had a material effect on our consolidated financial statements. Recently Adopted and Recently Issued Accounting Standards There were no recently adopted accounting standards that had a material effect on our consolidated financial statements and accompanying disclosures. The table below outlines recently issued accounting standards not yet adopted that could have an impact to the consolidated financial statements upon adoption. Standard Description Effective Date Effect on the Consolidated Financial Statements (or Other Significant Matters) Accounting Standards Update No. 2024-03 (Subtopic 220-40): Disaggregation of Income Statement Expenses In November 2024, the Financial Accounting Standards Board issued a new standard to improve income statement expense disclosures. The standard requires greater disaggregated information on certain expense captions, as well as disclosures about selling expenses. This standard will be effective for us for our annual period beginning April 1, 2027 and interim periods beginning April 1, 2028, with early adoption permitted. We are currently evaluating the impact of this standard on our consolidated financial statements and disclosures. Concentration of Credit Risk We grant credit to customers in a wid …

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"Capitalization On April 15, 2026, our board of directors (the ""Board"") approved recommitting our existing share repurchase program so that $250,000 was available. The share repurchase program has no expiration date. For the three months ended June 30, 2026, we repurchased $10,131 of our common stock, or approximately 98 shares. The remaining amount available under the share repurchase program as of June 30, 2026 was $239,870."

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