What Happened?

Shares of data backup provider Commvault (NASDAQ: CVLT) jumped 16.1% in the morning session after the company reported first-quarter fiscal 2026 results that surpassed analyst expectations and raised its full-year revenue outlook. The data protection company posted revenue of $282 million, a 26% year-over-year increase that beat forecasts. Adjusted earnings came in at $1.01 per share, also ahead of estimates. The strong performance was driven by a significant shift to its subscription-based services. Subscription revenue surged 46% year-over-year, while its Software-as-a-Service (SaaS) offerings jumped 66%. This growth was also reflected in the company’s total Annualized Recurring Revenue (ARR), a key metric for future business, which climbed 24% to $996 million. Capping the positive report, Commvault provided an optimistic forecast for the second quarter and raised its revenue guidance for the full fiscal year.

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What Is The Market Telling Us

Commvault Systems’s shares are quite volatile and have had 18 moves greater than 5% over the last year. But moves this big are rare even for Commvault Systems and indicate this news significantly impacted the market’s perception of the business.

The previous big move we wrote about was 13 days ago when the stock gained 3.2% on the news that Guggenheim upgraded the firm's stock to "Buy" from "Neutral". The investment firm also set a price target of $210, the highest on Wall Street, suggesting a significant potential upside from its previous closing price. Guggenheim analyst Howard Ma cited positive channel checks and strong underlying demand for data protection as key reasons for the bullish turn. The analyst noted that Commvault's software-as-a-service (SaaS) offering is gaining traction and is a preferred choice for complex, hybrid enterprise IT environments. Guggenheim anticipates that Commvault will outperform on key financial metrics at the start of its fiscal year 2026, forecasting both revenue growth and free cash flow margins to exceed 20%. This positive sentiment was echoed by the majority of analysts covering the stock, with a consensus "Moderate Buy" rating.

Commvault Systems is up 28% since the beginning of the year, and at $194.66 per share, has set a new 52-week high. Investors who bought $1,000 worth of Commvault Systems’s shares 5 years ago would now be looking at an investment worth $4,465.

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