Rubrik Q1 FY26 slides: Subscription ARR grows 38% as cyber resilience focus pays off

Introduction & Market Context

Rubrik Inc (NASDAQ:RBRK) presented its Q1 FY26 investor presentation on June 5, 2025, highlighting the company’s continued growth and strategic positioning in the cybersecurity market. The data security provider has positioned itself at the intersection of data, security, and AI, with a core focus on cyber resilience solutions.

Following strong Q4 FY25 results that saw the stock surge 15.57% after beating earnings expectations, Rubrik continues to demonstrate momentum with its subscription-based business model. The company’s stock closed at $98.54 on June 5, 2025, and gained an additional 0.97% in after-hours trading, reflecting ongoing investor confidence in Rubrik’s growth trajectory.

As shown in the following illustration of Rubrik’s strategic positioning:

Quarterly Performance Highlights

Rubrik reported impressive financial metrics for Q1 FY26, with Subscription Annual Recurring Revenue (ARR) reaching $1.18 billion, representing 38% year-over-year growth. The company’s Cloud ARR showed even stronger performance, growing 60% year-over-year to $972 million, underscoring Rubrik’s success in cloud-based security solutions.

The company’s key performance indicators demonstrate the strength of its subscription-based business model:

Customer expansion remains a significant growth driver for Rubrik, with Average Subscription Dollar-Based Net Revenue Retention exceeding 120%. The company now serves 2,381 customers with $100K+ in Subscription ARR, continuing the strong upward trajectory in enterprise customer acquisition.

The following chart illustrates Rubrik’s consistent ARR growth over the past three years:

Strategic Initiatives

Rubrik’s presentation emphasized its comprehensive approach to cyber resilience across data and identity. The company has built an integrated security cloud that addresses enterprise, cloud, SaaS, unstructured data, and identity providers through a single platform.

As illustrated in this comprehensive overview of Rubrik’s security cloud platform:

The company highlighted two key strategic frontiers: Cloud Resilience and Identity Resilience. With businesses increasingly running critical operations in the cloud, Rubrik is focusing on providing comprehensive cyber resilience for organizations from "code to cloud" - covering everything from the first line of code to full-stack applications.

Rubrik’s cloud innovation addresses three key customer challenges: cyberattacks targeting cloud environments, complexity arising from multi-cloud deployments, and managing cloud costs. The company’s solutions include comprehensive cyber resilience capabilities, multi-cloud operational simplicity, and cost-saving technologies.

As shown in this breakdown of Rubrik’s cloud innovation strategy:

In the identity resilience space, Rubrik emphasized the growing threat vector of attackers who "log in" rather than "break in," highlighting the need for robust identity protection alongside data security. The company’s identity recovery solutions for Active Directory and Entra ID address complex recovery challenges, risks of malware reinfection, and hybrid cloud recovery needs.

Detailed Financial Analysis

Rubrik’s financial performance demonstrates a successful transition to a subscription-based business model. Subscription revenue now accounts for 95% of total revenue in Q1 FY26, up from 64% in FY 2023, reflecting the company’s strategic shift away from maintenance and other product revenue.

The following chart illustrates this revenue mix transformation:

Profitability metrics show significant improvement, with Non-GAAP gross margin reaching 81% in Q1 FY26, up from 75% in Q1 FY25. Free cash flow has also turned positive, with a 12% FCF margin in Q1 FY26 compared to -20% in Q1 FY25.

This chart demonstrates the company’s improving margin profile:

Operating leverage continues to improve as Rubrik scales its business. The Non-GAAP Subscription ARR Contribution Margin has steadily improved from -38% in FY 2023 to 8% for the last twelve months ending Q1 FY26, indicating greater efficiency in converting ARR to profitability.

As shown in this operating leverage trend:

Forward-Looking Statements

For Q2 FY26, Rubrik provided guidance for Subscription ARR between $1,380 million and $1,388 million, with total revenue expected to be $281-$283 million. For the full fiscal year 2026, the company projects total revenue of $1,179-$1,189 million and free cash flow of $65-$75 million.

The company expects continued improvement in its Subscription ARR Contribution Margin, projecting approximately 6% for the full fiscal year, with Q2 FY26 expected to be between 4.5% and 5.5%.

As detailed in the company’s guidance table:

Rubrik’s Q1 FY26 presentation reinforces the company’s strong position in the cybersecurity market, particularly at the intersection of data security and AI. With consistent ARR growth, improving profitability metrics, and strategic focus on cloud and identity resilience, Rubrik appears well-positioned to capitalize on the growing demand for comprehensive cyber resilience solutions.

The company’s performance aligns with CEO Bipul Sinha’s statement from the Q4 earnings call that Rubrik has "a unique opportunity to continue to build out the company and build out the platform at the intersection of data security and AI." With the stock trading near $99, up significantly from its 52-week low of $28.34, investors continue to show confidence in Rubrik’s growth strategy and market position.

Full presentation:

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