Nucor earnings beat by $0.08, revenue fell short of estimates
Introduction & Market Context
Nutanix Inc (NASDAQ:NTNX) presented its third-quarter fiscal year 2025 results on May 28, showcasing strong performance across key metrics. The cloud computing company reported significant revenue growth and margin expansion, exceeding analyst expectations despite a challenging macroeconomic environment. Following the earnings release, Nutanix shares experienced a slight pullback, trading at $75.85 on May 29, down 3.83% from the previous close, though still near its 52-week high of $83.36.
The company’s presentation highlighted its continued execution in the hybrid multi-cloud market, with substantial customer additions and strategic partnerships bolstering its competitive position. Analysts maintain a bullish outlook on Nutanix, with a consensus recommendation of "Strong Buy" according to available market data.
Quarterly Performance Highlights
Nutanix delivered impressive financial results for Q3 FY2025, outperforming across all guided metrics. Revenue reached $639.0 million, representing a 22% year-over-year increase, while non-GAAP operating margin expanded significantly to 21.5%, up 750 basis points compared to the same period last year.
As shown in the following financial summary:
The company’s Annual Recurring Revenue (ARR) grew to $2.14 billion, up 18% year-over-year, demonstrating Nutanix’s successful transition to a subscription-based business model. This growth trajectory has been consistent over multiple quarters, as illustrated in the ARR trend chart:
Customer acquisition remained strong, with Nutanix adding 620 new logos during the quarter. The company’s cumulative customer base has shown steady growth, reaching 28,490 by the end of Q3 FY2025:
Executive Commentary
Nutanix’s leadership expressed confidence in the company’s performance and strategic direction. President and CEO Rajiv Ramaswami attributed the strong results to the strength of the Nutanix Cloud Platform and increasing demand from businesses seeking long-term technology partners.
"We are happy to report third quarter results that came in ahead of our guidance," Ramaswami noted in the presentation. He emphasized that recent announcements around external storage support, modern applications, and generative AI reflect the company’s focus on innovation and strategic partnerships.
CFO Rukmini Sivaraman highlighted the company’s financial discipline, pointing to 18% year-over-year ARR growth and strong free cash flow generation. "We remain focused on delivering sustainable, profitable growth," Sivaraman stated.
Strategic Initiatives & Partnerships
The presentation outlined several strategic initiatives that position Nutanix for continued growth. The company announced the general availability of its NCI Compute product, expanding support for external storage solutions. Additionally, Nutanix highlighted its partnership with Pure Storage (NYSE:PSTG), enhancing its storage capabilities and market reach.
In cloud infrastructure, Nutanix announced Cloud Native AOS, designed to deliver enterprise storage and advanced data services to hyperscaler Kubernetes services and cloud-native bare-metal environments. The company also expanded its cloud provider support with the announcement of NCP support for Google (NASDAQ:GOOGL) Cloud, complementing its existing partnerships with major cloud providers.
These strategic moves reinforce Nutanix’s position in the hybrid multi-cloud market, offering customers greater flexibility and choice in their infrastructure deployments. The company’s focus on Kubernetes and container technologies also aligns with industry trends toward modernizing application infrastructure.
Financial Analysis & Trends
Nutanix’s financial performance demonstrates improving operational efficiency alongside revenue growth. The company reported a non-GAAP gross margin of 88.2%, up 170 basis points year-over-year, reflecting the high-margin nature of its software and subscription business.
Non-GAAP operating expenses increased by 12% to $426.5 million, growing at a slower rate than revenue, which contributed to the significant operating margin expansion. Non-GAAP net income per share (diluted) reached $0.42, an increase of $0.18 compared to the same period last year.
Free cash flow generation was particularly strong at $203.4 million, up $125.1 million year-over-year, highlighting Nutanix’s improving cash conversion capabilities. The company’s average contract duration increased slightly to 3.1 years, providing greater revenue visibility and stability.
Forward Guidance & Outlook
Based on its strong performance, Nutanix raised its full-year fiscal 2025 guidance across all previously guided metrics. For the fourth quarter of fiscal 2025, the company provided the following outlook:
For the full fiscal year 2025, Nutanix now expects:
The revised guidance projects revenue between $2.52 billion and $2.53 billion for the full year, representing approximately 17.5% year-over-year growth. Non-GAAP operating margin is expected to reach approximately 20.5%, while free cash flow is projected between $700 million and $730 million.
This upward revision reflects management’s confidence in Nutanix’s business momentum and ability to execute its strategic initiatives despite potential macroeconomic uncertainties. The company continues to focus on enhancing its sales, marketing, and R&D investments while maintaining financial discipline, positioning itself for sustainable growth in the evolving cloud infrastructure market.
Full presentation:
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