Rubrik, Inc. (RBRK) - Q1 2027 Form 10-Q Summary
Business Context and Reporting Period
This report covers the quarterly period ended April 30, 2026 (Fiscal Q1 2027). Rubrik, Inc. is a security and artificial intelligence (AI) operations company focused on Zero Trust Data Security. The company recently launched the Rubrik Agent Cloud (RAC) in February 2026 to monitor and control agentic AI actions. The company has largely completed its transition from legacy perpetual licenses to the Rubrik Security Cloud (RSC) subscription model.
Key Financial Metrics
| Metric | Q1 2027 (Ended Apr 30, 2026) | Q1 2026 (Ended Apr 30, 2025) |
|---|---|---|
| Total Revenue | $387.1 million | $278.5 million |
| Subscription Revenue | $374.2 million | $265.7 million |
| Gross Profit | $311.8 million | $218.0 million |
| Gross Margin | 81% | 78% |
| Net Loss | $(41.9) million | $(102.1) million |
| Net Loss Per Share (Basic & Diluted) | $(0.21) | $(0.53) |
| Operating Cash Flow | $81.7 million | $39.7 million |
| Free Cash Flow | $73.6 million | $33.3 million |
| Cash, Cash Equivalents & Short-Term Investments | $1.75 billion | $1.68 billion |
| Convertible Senior Notes (Principal) | $1.15 billion | N/A (Issued June 2025) |
Material Changes vs. Prior Period
- Revenue Growth: Total revenue increased 39% year-over-year, driven primarily by a 41% increase in subscription revenue. Subscription revenue now represents 97% of total revenue.
- Profitability Improvement: Net loss narrowed significantly by 59% to $41.9 million, aided by higher interest income ($15.9 million vs. $7.7 million) and reduced interest expense following the repayment of a prior credit facility.
- Operating Expenses: Total operating expenses increased 17% to $364.4 million. Research and Development (R&D) expenses rose 40% due to headcount increases and higher stock-based compensation. Sales and Marketing expenses increased 14% due to marketing spend and headcount.
- Key Metrics: Subscription Annual Recurring Revenue (ARR) grew 32% to $1.57 billion. Cloud ARR grew 43% to $1.39 billion. The average subscription dollar-based net retention rate remained approximately 120%.
Guidance, Outlook, and Risks
- Outlook: Management expects subscription revenue to continue benefiting from customers exercising or forfeiting "Subscription Credits" (material rights) through fiscal 2027, though these benefits are expected to decline sequentially. The RSC suite is expected to remain the primary revenue driver.
- Capital Structure: In June 2025, the company issued $1.15 billion in 0.00% convertible senior notes due 2030. Proceeds were used to repay a prior credit facility and fund general corporate purposes.
- Risks:
- Supply Chain: Reliance on a limited number of contract manufacturers for commodity servers, subject to global chip shortages and allocation constraints.
- AI Regulation & Liability: Risks associated with the use of generative and agentic AI tools, including potential legal liability, IP infringement, and evolving regulatory frameworks (e.g., EU AI Act).
- Legal Proceedings: Ongoing DOJ investigation regarding potential violations of federal law in connection with government contracts involving a former employee.
- Revenue Volatility: Fluctuations in revenue recognition due to the timing of customer transitions to RSC and the exercise of Subscription Credits.
Investor Verification Checklist
- Verify the sustainability of the 32% Subscription ARR growth rate as the benefit from "Subscription Credits" (material rights) declines sequentially.
- Monitor the status and potential financial impact of the ongoing DOJ investigation regarding government contracts.
- Assess the impact of global semiconductor shortages on the deployment of Rubrik-branded Appliances and potential margin compression from commercial accommodations.
- Review the trajectory of R&D expenses, which increased 40% YoY, to ensure alignment with product development milestones for RAC and RSC.
- Confirm the company's ability to maintain a 120% net retention rate in a competitive market with increasing AI-focused competitors.