Key Takeaways:
- Revenue rose 10% to $703.1M, beating consensus by 2.53%
- ARR grew 15% to $2.43B as average contract duration lengthened
- Nutanix raised its full-year revenue outlook to as much as $2.84B
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Nutanix beats Q3 estimates as ARR climbs 15% to $2.43B
Nutanix Inc. reported fiscal third-quarter revenue of $703.1 million, beating estimates by 2.53%, as annual recurring revenue climbed 15%.
"Our results reflect strong execution in a dynamic environment, with customers committing to longer-term platform deployments," Chief Executive Officer Rajiv Ramaswami said in the earnings release.
Non-GAAP earnings came in at 47 cents a share, topping the consensus estimate by 34.29%. Revenue rose 10% from $639 million a year earlier. Subscription revenue, which accounted for 94.6% of total revenue, increased 9% to $664.8 million. The company added 730 new logos, up 18% year over year, bringing its cumulative customer count to 31,710.
Shares rose 0.56% to $46.81 in aftermarket trading. The company projected fourth-quarter revenue of $725 million to $745 million and raised its full-year fiscal 2026 revenue outlook to $2.82 billion to $2.84 billion, up from a prior range.
Average contract duration extended to 3.4 years from 3.1 years a year earlier, a sign that customers are deepening their commitment to Nutanix's hybrid cloud platform. Non-GAAP gross margin contracted 40 basis points to 87.8%, while non-GAAP operating margin expanded 80 basis points to 22.3%, reflecting improved operating leverage.
Cash and short-term investments totaled $2.01 billion as of April 30, up from $1.87 billion three months earlier. Operating cash flow reached $207.5 million, and free cash flow was $197.2 million. The board authorized an additional $750 million in share repurchases, expanding the company's buyback capacity.
The guidance raise suggests management expects demand for hybrid cloud infrastructure to sustain its momentum. Investors will watch the Q4 earnings call for updates on gross margin trajectory and whether the lengthening contract cycle continues to support revenue visibility.
This article is for informational purposes only and does not constitute investment advice.
