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MUMBAI - Varonis Systems , Inc. (NASDAQ:VRNS), a global data security company valued at $4.82 billion, has established new data centers in Mumbai and Pune, India. With impressive gross profit margins of 83% and steady revenue growth of 10.4% over the last twelve months, the company continues its expansion. These facilities are designed to assist customers in adhering to India’s data sovereignty regulations and local regulatory frameworks. According to InvestingPro analysis, Varonis maintains a moderate debt level while pursuing strategic growth initiatives. This move comes as India’s draft rules under the Digital Personal Data Protection Act prompt businesses to navigate the country’s complex legal landscape.
The new data centers will enable Varonis’ customers, including financial and insurance institutions regulated by the Reserve Bank of India (NSE:BOI), the Securities and Exchange Board of India, and the Insurance Regulatory and Development Authority of India, to meet strict data localization requirements. The Group CISO of Aditya Birla (NSE:ADTB) Capital, Makesh Chandramohan, noted that partnering with Varonis will enhance their compliance, reduce latency, and improve cybersecurity.
Scott Leach, Varonis VP of APAC, emphasized the company’s commitment to providing deep data visibility and security across diverse environments. Maheswaran Shanmugasundaram, Country Manager for India at Varonis, remarked that the data centers will support the company’s mission to protect sensitive data automatically, ensuring compliance and security for their customers.
Varonis’ Data Security Platform is designed to address the challenges of securing rapidly growing data volumes by offering AI-powered automation for threat detection and data protection. The platform provides solutions for data security posture management, data classification, data access governance, data loss prevention, and insider risk management.
The establishment of these data centers in India demonstrates Varonis’ dedication to its customers in the region, aiming to meet their needs for data sovereignty and regulatory compliance comprehensively. InvestingPro analysis indicates the company is currently trading above its Fair Value, reflecting market confidence in its expansion strategy. InvestingPro subscribers can access 8 additional key insights and a comprehensive Pro Research Report, offering detailed analysis of Varonis’s market position and growth prospects among 1,400+ top US stocks.
This expansion into India is part of Varonis’ ongoing efforts to help organizations worldwide protect their most valuable and vulnerable assets—data. Information about the new data centers and Varonis’ services is based on a press release statement from the company.
In other recent news, Varonis Systems reported a 3% year-over-year increase in revenue for the fourth quarter of 2024, amounting to $158.5 million. The company exceeded earnings per share (EPS) expectations, reporting $0.18 per share against a forecast of $0.14. Despite these positive earnings, the revenue fell short of expectations, which contributed to a decline in the company’s stock. Varonis Systems is in the midst of transitioning to a Software-as-a-Service (SaaS) model, a strategic shift that now accounts for 53% of its annual recurring revenue (ARR). The company’s ARR grew by 18% to $641.9 million, reflecting steady growth in this area.
In another development, Varonis Systems announced a change in the settlement method for its 1.250% Convertible Senior Notes due in 2025, opting for a "Physical Settlement" where note holders will receive shares of common stock upon conversion. This decision marks a shift from the previous "Default Settlement Method," which could involve cash or other methods. Additionally, the company has set its ARR guidance for 2025 at $737-$745 million, indicating expected growth of 15-16%. Looking forward, Varonis Systems aims to complete its SaaS transition by the end of 2025, a year earlier than previously anticipated, as part of its strategy to enhance data security solutions.
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