Rubrik (RBRK) Q2 FY2027 Earnings Call: Q&A Summary

Q: Saket Kalia with Barclays asked how much subscription ARR in the quarter came from the Strata Identity deal or inorganic contributions in general.

A: Kiran Choudary, Chief Financial Officer, clarified that there was zero ARR from the Strata acquisition in the reported quarter and zero assumed in the guidance for the year.

Q: Fatima Boolani with Citi noted a step-down implied in the back-half net new ARR guidance and asked what factors were explicitly accounted for and what levers could drive a stronger performance.

A: Kiran Choudary, Chief Financial Officer, responded that management raised guidance by the full Q2 beat plus an additional amount, bringing the implied net new ARR growth rate up by 700 basis points to 14%. Bipul Sinha, CEO, added that net new ARR was raised by $45 million over two quarters without any inorganic contributions.

Q: John DiFucci with Guggenheim asked where Rubrik stands with its AI products and whether they are ready for enterprise customer adoption.

A: Bipul Sinha, CEO, stated that Rubrik takes a comprehensive approach to agentic security and governance across visibility, identity, runtime security, and agent rewind, meaning the platform is ready for customers as they scale their AI deployments.

Q: Gregg Moskowitz with Mizuho asked about the dynamics behind cloud net new ARR growth compared to total subscription ARR growth and high-level expectations for the mix.

A: Kiran Choudary, Chief Financial Officer, explained that non-cloud business is directed toward regulated industries and government agencies that prefer self-hosted options, and both cloud and non-cloud are growth drivers for total subscription ARR.

Q: Eric Heath with KeyBanc asked about the incremental demand for cyber resilience or Rubrik Agent Cloud in response to the Mythos inflection.

A: Bipul Sinha, CEO, stated that Mythos and frontier AI models have accelerated the need for AI speed recovery and preemptive recovery engines because traditional prevention and detection are no longer sufficient.

Q: Keith Bachman with BMO asked about competition for Rubrik Agent Cloud, whether the 15 reported customers are paying customers, and when ARR contribution might materialize.

A: Bipul Sinha, CEO, confirmed they have more than 15 paying customers for RAC and noted that point solution competitors exist in observability and identity, but Rubrik offers a comprehensive platform approach. Kiran Choudary, Chief Financial Officer, added that there is minimal assumption of RAC ARR contribution in this year's guidance.

Q: Junaid Siddiqui with Truist asked if there is a measurable increase in displacement opportunities where customers are reconsidering hardware-dependent backup architectures due to pricing environments.

A: Bipul Sinha, CEO, answered that Rubrik is primarily a software company not limited by point solutions on data centers, and Kiran Choudary, Chief Financial Officer, reiterated that there was no material impact from hardware pricing or supply chains on subscription ARR.

Q: Paramveer Singh with Oppenheimer asked how ubiquitous the adoption of Identity Resilience is across the installed base and if it represents an incremental penetration opportunity.

A: Bipul Sinha, CEO, replied that identity penetration is still early and represents a significant opportunity, noting that they recently closed the largest international identity deal in Rubrik's history with an existing customer.

Q: Zachary Schneider with Baird asked how management thinks about the build versus buy prospect as opportunities broaden across identity and AI.

A: Bipul Sinha, CEO, explained that Rubrik follows a platform strategy focused on complementary network effects and looks for teams and technologies that can accelerate their roadmap and integration into the single platform.

Q: Gray Powell with U.S. Banc asked if growth in non-cloud ARR is a positive development and whether there are differences in gross margin profiles or expansion potential.

A: Kiran Choudary, Chief Financial Officer, stated that non-cloud is a smaller but growing business driven by sovereign cloud and regulatory requirements, and noted it carries a higher margin because customers handle the hosting.

Q: Rudy Kessinger with D.A. Davidson asked what customers are seeing regarding hardware lead times relative to 90 days ago and how they navigate procurement issues.

A: Kiran Choudary, Chief Financial Officer, responded that hardware represents a small portion of sales largely in smaller regions like Asia Pacific, and lead times actually improved from the start of the year with no material impact on subscription ARR.

Q: Joe Vandrick with Scotiabank asked what is driving strength in the Identity Resilience business and whether demand is incident-driven, proactive, greenfield, or competitive displacements.

A: Bipul Sinha, CEO, stated that identity has become the weakest link in cyber attacks and ground zero for security breaches, leading to a mix of brownfield and whitespace customers buying into both identity recovery and resilience.