CommVault Systems Inc. (CVLT, Financial) filed Quarterly Report for the period ended 2010-06-30.
Commvault Systems Inc. has a market cap of $868.5 million; its shares were traded at around $20.12 with a P/E ratio of 47.9 and P/S ratio of 3.2. CVLT is in the portfolios of Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.
As of June 30, 2010, we had unrecognized tax benefits of $4.4 million, all of which, if recognized, would favorably affect the effective tax rate. In addition, we have accrued interest and penalties of $1.1 million related to the unrecognized tax benefits. Interest and penalties, if any, related to unrecognized tax benefits are recorded in income tax expense. Components of the reserve are classified as either current or long-term in the Consolidated Balance Sheet based on when we expect each of the items to be settled. Accordingly, our unrecognized tax benefits of $4.4 million and the related accrued interest and penalties of $1.1 million are included in Other Liabilities on the Consolidated Balance Sheet. During the three months ended June 30, 2010, we recognized $0.8 million of previously unrecognized tax benefits and $0.3 million of related accrued interest and penalties totaling $1.1 million as a result of the expiration of a statue of limitations in a foreign jurisdiction. We believe that it is reasonably possible that approximately $0.7 million of our currently remaining unrecognized tax benefits and approximately $0.2 million of related accrued interest and penalties may also be realized by the end of fiscal 2011 as a result of the lapse of the statue of limitations.
Software revenue derived from enterprise software transactions (transactions greater than $0.1 million) represented approximately 44% of our software revenue in the three months ended June 30, 2010 and approximately 40% of our software revenue in the three months ended June 30, 2009. As a result, enterprise software transactions increased by $0.8 million, or 7%, in the three months ended June 30, 2010 compared to the three months ended June 30, 2009. This increase was primarily driven by a higher average dollar amount of such transactions, partially offset by a 6% decrease in the total number of transactions of this type. The average dollar amount of such transactions was approximately $250,000 in the three months ended June 30, 2010 and approximately $220,000 in the three months ended June 30, 2009. The increase in enterprise software transactions was offset by a 9% decrease in software transactions less than $0.1 million as a result of lower software revenue transactions of this type from both our U.S. operations and foreign locations.
Services Revenue. Services revenue increased $6.9 million, or 22%, from $31.1 million in the three months ended June 30, 2009 to $38.0 million in the three months ended June 30, 2010. Services revenue represented 57% of our total revenues in the three months ended June 30, 2010 compared to 52% in the three months ended June 30, 2009. The increase in services revenue is primarily due to a $6.1 million increase in revenue from customer support agreements as a result of software sales to new customers and renewal agreements with our installed software base.
Cost of Services Revenue. Cost of services revenue increased $1.4 million, or 18%, from $7.6 million in the three months ended June 30, 2009 to $9.0 million in the three months ended June 30, 2010. Cost of services revenue represented 24% of our services revenue in both the three months ended June 30, 2010 and 2009. The increase in cost of services revenue is primarily the result of higher employee compensation and travel expenses totaling approximately $1.0 million as well as a $0.1 million increase in third-party outsourcing costs to facilitate our services revenue growth.
Sales and Marketing. Sales and marketing expenses increased $5.4 million, or 18%, from $30.4 million in the three months ended June 30, 2009 to $35.8 million in the three months ended June 30, 2010. The increase is primarily due to a $3.2 million increase in employee compensation and related expenses attributable to the expansion of our sales force from the prior year. Sales and marketing expenses also increased due to a $0.9 million increase in advertising and marketing related expenses as well as a $0.8 million increase in travel and related expenses primarily due to higher headcount. Sales and marketing expenses as a percentage of total revenues increased to 54% in the three months ended June 30, 2010 from 50% in the three months ended June 30, 2009.
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Commvault Systems Inc. has a market cap of $868.5 million; its shares were traded at around $20.12 with a P/E ratio of 47.9 and P/S ratio of 3.2. CVLT is in the portfolios of Jim Simons of Renaissance Technologies LLC, Steven Cohen of SAC Capital Advisors.
Highlight of Business Operations:
The weighted average fair value of stock options granted was $10.26 per share during the three months ended June 30, 2010, and $7.44 per share during the three months ended June 30, 2009. In addition, the weighted average fair value of restricted stock units awarded was $22.91 per share during the three months ended June 30, 2010, and $14.82 per share during the three months ended June 30, 2009.As of June 30, 2010, we had unrecognized tax benefits of $4.4 million, all of which, if recognized, would favorably affect the effective tax rate. In addition, we have accrued interest and penalties of $1.1 million related to the unrecognized tax benefits. Interest and penalties, if any, related to unrecognized tax benefits are recorded in income tax expense. Components of the reserve are classified as either current or long-term in the Consolidated Balance Sheet based on when we expect each of the items to be settled. Accordingly, our unrecognized tax benefits of $4.4 million and the related accrued interest and penalties of $1.1 million are included in Other Liabilities on the Consolidated Balance Sheet. During the three months ended June 30, 2010, we recognized $0.8 million of previously unrecognized tax benefits and $0.3 million of related accrued interest and penalties totaling $1.1 million as a result of the expiration of a statue of limitations in a foreign jurisdiction. We believe that it is reasonably possible that approximately $0.7 million of our currently remaining unrecognized tax benefits and approximately $0.2 million of related accrued interest and penalties may also be realized by the end of fiscal 2011 as a result of the lapse of the statue of limitations.
Software revenue derived from enterprise software transactions (transactions greater than $0.1 million) represented approximately 44% of our software revenue in the three months ended June 30, 2010 and approximately 40% of our software revenue in the three months ended June 30, 2009. As a result, enterprise software transactions increased by $0.8 million, or 7%, in the three months ended June 30, 2010 compared to the three months ended June 30, 2009. This increase was primarily driven by a higher average dollar amount of such transactions, partially offset by a 6% decrease in the total number of transactions of this type. The average dollar amount of such transactions was approximately $250,000 in the three months ended June 30, 2010 and approximately $220,000 in the three months ended June 30, 2009. The increase in enterprise software transactions was offset by a 9% decrease in software transactions less than $0.1 million as a result of lower software revenue transactions of this type from both our U.S. operations and foreign locations.
Services Revenue. Services revenue increased $6.9 million, or 22%, from $31.1 million in the three months ended June 30, 2009 to $38.0 million in the three months ended June 30, 2010. Services revenue represented 57% of our total revenues in the three months ended June 30, 2010 compared to 52% in the three months ended June 30, 2009. The increase in services revenue is primarily due to a $6.1 million increase in revenue from customer support agreements as a result of software sales to new customers and renewal agreements with our installed software base.
Cost of Services Revenue. Cost of services revenue increased $1.4 million, or 18%, from $7.6 million in the three months ended June 30, 2009 to $9.0 million in the three months ended June 30, 2010. Cost of services revenue represented 24% of our services revenue in both the three months ended June 30, 2010 and 2009. The increase in cost of services revenue is primarily the result of higher employee compensation and travel expenses totaling approximately $1.0 million as well as a $0.1 million increase in third-party outsourcing costs to facilitate our services revenue growth.
Sales and Marketing. Sales and marketing expenses increased $5.4 million, or 18%, from $30.4 million in the three months ended June 30, 2009 to $35.8 million in the three months ended June 30, 2010. The increase is primarily due to a $3.2 million increase in employee compensation and related expenses attributable to the expansion of our sales force from the prior year. Sales and marketing expenses also increased due to a $0.9 million increase in advertising and marketing related expenses as well as a $0.8 million increase in travel and related expenses primarily due to higher headcount. Sales and marketing expenses as a percentage of total revenues increased to 54% in the three months ended June 30, 2010 from 50% in the three months ended June 30, 2009.
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