EPS of $-0.53 increased by 87.2% from previous year
Gross margin of 78.3%
Net income of -102.10M
""we are a true platform company. We actually took on legacy backup and recovery and transformed that into a data security platform to deliver cyber resilience. And this Rubrik Security Cloud has built in preemptive recovery engine that takes the cyber recovery time from weeks and months to hours."" - Bipul Sinha
Rubrik Inc (RBRK) QQ1 2026 Results: Robust ARR Growth, Margin Expansion, and Strategic Position in Cyber Resilience
Executive Summary
Rubrik reported a strong QQ1 2026 performance, highlighted by material ARR expansion and improved profitability. Subscription ARR rose to approximately $1.18 billion, up 38% year over year, while subscription revenue climbed 54% to $266 million. Total revenue reached $278 million, up 49% year over year, supported by higher ARR and favorable cloud transformation dynamics. The company also posted a meaningful improvement in subscription ARR contribution margin, improving over 1,800 basis points year over year to positive 8% (12 months ended April 30), underscoring operating leverage at scale. Free cash flow was $33 million, reflecting better operating efficiency even as increases in annual and monthly payment terms modestly affected working capital dynamics. Rubrik is guiding to continued strength in QQ2 and full-year FY2026, with ARR expected to reach $1.38–$1.388 billion (up 26–27% YoY) and total revenue of $1.179–$1.189 billion (up ~33–34% YoY). Non-GAAP subscription ARR contribution margins are anticipated to be ~4.5–5.5% in Q2 and ~6% for the full year, with non-GAAP EPS of -$0.35 to -$0.33 in Q2 and -$1.02 to -$0.96 for FY2026. Management frames this as a multiyear platform strategy anchored in cyber resilience across data and identity, with ongoing investments in R&D and go-to-market to capitalize on a large and growing TAM. The narrative emphasizes a durable, long-term trajectory driven by a true platform that integrates data and identity, a persistent demand environment for cyber resilience, and a growing opportunity in identity resilience and GenAI-related initiatives (Annapurna).
Key Performance Indicators
Revenue
278.48M
QoQ: 7.90% | YoY:48.67%
Gross Profit
218.00M
78.28% margin
QoQ: 9.19% | YoY:138.68%
Operating Income
-93.09M
QoQ: 19.83% | YoY:87.16%
Net Income
-102.10M
QoQ: 11.13% | YoY:86.05%
EPS
-0.53
QoQ: 13.11% | YoY:87.23%
Revenue Trend
Margin Analysis
Key Insights
Q1 2026 total revenue: $278.481 million, up 49% YoY; subscription revenue: $266.0 million, up 54% YoY; gross profit: $217.998 million; gross margin (non-GAAP): 80.5% vs 75.4% YoY.
Net income: -$102.104 million; EPS (diluted): -$0.53; weighted average shares: 191.6 million.
ARR metrics: subscription ARR reached $1.18 billion, up 38% YoY; net new subscription ARR: $89 million; cloud ARR: $972 million, up 60% YoY; subscription ARR contribution margin: +8% (TTM to Apr 30), vs -11% in the prior-year period (normalized for IPO payroll tax impact).
Profitability and Leverage
Non-GAAP gross margin: 80.5% (Q1 2026) vs 75.4% (Q1 2025).
Revenue and Growth
- Q1 2026 total revenue: $278.481 million, up 49% YoY; subscription revenue: $266.0 million, up 54% YoY; gross profit: $217.998 million; gross margin (non-GAAP): 80.5% vs 75.4% YoY.
- Net income: -$102.104 million; EPS (diluted): -$0.53; weighted average shares: 191.6 million.
- ARR metrics: subscription ARR reached $1.18 billion, up 38% YoY; net new subscription ARR: $89 million; cloud ARR: $972 million, up 60% YoY; subscription ARR contribution margin: +8% (TTM to Apr 30), vs -11% in the prior-year period (normalized for IPO payroll tax impact).
Profitability and Leverage
- Non-GAAP gross margin: 80.5% (Q1 2026) vs 75.4% (Q1 2025).
- EBITDA: -$82.94 million; EBIT margin: -33.43% of revenue; operating margin: -33.43% (as reported).
- Free cash flow: +$33 million, versus -$37 million in the year-ago quarter; balance of cash generation supported by ARR expansion and improved operating leverage.
Customer and Geographic Mix
- 2,381 customers with subscription ARR ≥ $100k, up 28% YoY; these customers now represent 85% of subscription ARR (up from 81% a year ago).
- Americas revenue: $203 million, up 51%; outside Americas: $75 million, up 43%.
Capital Structure and Balance Sheet
- End of Q1 cash, cash equivalents, restricted cash and marketable securities: $762 million; total debt: $323 million; net debt position reported as $38.8 million (per balance sheet data).
- Cash position supports continued capex in R&D and GTM investments to sustain growth and platform development.
Income Statement
Metric
Value
YoY Change
QoQ Change
Revenue
278.48M
48.67%
7.90%
Gross Profit
218.00M
138.68%
9.19%
Operating Income
-93.09M
87.16%
19.83%
Net Income
-102.10M
86.05%
11.13%
EPS
-0.53
87.23%
13.11%
Key Financial Ratios
Net Income vs. Revenue
Expense Breakdown
Management Commentary
Key management insights from the QQ1 2026 earnings call:
- Platform strategy and market thesis: "we are a true platform company" with a single preemptive recovery engine that enables rapid cyber recovery and a unified view across data and identity. This is cited as a differentiator vs legacy or bolt-on solutions.
- TAM expansion through identity resilience: Bipul Sinha emphasized that identity resilience expands the TAM by addressing identity-based attacks and integrating data and identity risk into a single platform. Quote: "the new identity resilience angle is expanding our TAM… combining data and identity."
- Growth drivers and product momentum: The management highlighted DSPM, identity resilience, and Annapurna AI as part of a lateral motion to unlock the next S-curves, with DSPM ARR up over 300% YoY and early momentum for identity recovery.
- Customer wins and real-world validation: Examples include a major U.S. pharmacy solutions company adopting RSC Enterprise Edition with unstructured data and SaaS protection, and a large European insurer leveraging RSC Enterprise Edition with unstructured data protection for cloud and enterprise data.
- Cloud innovations and coverage: Rubrik underscored four cloud initiatives (code-to-cloud cyber resilience, protection for cloud relational databases like AWS RDS, expanded Google Cloud capabilities, and Rubrik for OCI) that underpin differentiated product capabilities.
- Field outlook and cadence: The company noted solid demand, ongoing investments in R&D and GTM, and a multiquarter runway with expectations to deliver durable growth in FY2026. CFO commentary highlighted the seasonality in subscription ARR as net new ARR timing and operating expenses shape quarterly margins, and guided to Q2 revenue of $281–$283 million and full-year revenue of $1.179–$1.189 billion.
"we are a true platform company. We actually took on legacy backup and recovery and transformed that into a data security platform to deliver cyber resilience. And this Rubrik Security Cloud has built in preemptive recovery engine that takes the cyber recovery time from weeks and months to hours."
— Bipul Sinha
"the new identity resilience angle is expanding our TAM… combining data and identity."
— Bipul Sinha
Forward Guidance
Guidance and assessment:
- Q2 2026 guidance: Revenue of $281–$283 million (up 37–38% YoY); non-GAAP subscription ARR contribution margin of 4.5–5.5%; non-GAAP EPS of -$0.35 to -$0.33; ~196 million weighted-average shares.
- FY2026 guidance: Subscription ARR of $1.380–$1.388 billion (up 26–27% YoY); total revenue of $1.179–$1.189 billion (up 33–34% YoY); non-GAAP subscription ARR contribution margin of ~6%; non-GAAP EPS of -$1.02 to -$0.96; free cash flow of $65–$75 million.
- Confidence drivers: Sustained demand for cyber resilience; multi-product platform advantages; expansion into DSPM and identity resilience; ongoing cloud adoption and GenAI-related initiatives (Annapurna)."
- Outlook considerations: Management notes seasonal dynamics (Q3 typically the lowest subscription contribution margin due to timing of net new ARR and expenses) and emphasizes a long-term opportunity in identity and data security as GenAI adoption accelerates. Investors should monitor: pace of large ARR contractions, adoption of Proactive/Identity Recovery SKUs, ARR mix between land-and-expand, and changes in discounting or term-structure that could influence quarterly margins.
Competitive Position
Company
Gross Margin
Operating Margin
Return on Equity
P/E Ratio
RBRK Focus
78.28%
N/A
N/A
N/A
Gross Profit Margin
Operating Profit Margin
Return on Equity
P/E Ratio Comparison
Investment Outlook
Institutional takeaway: Rubrik has built a durable platform with an expanding data-and-identity security moat. The QQ1 2026 results demonstrate meaningful ARR growth, robust gross margins, and improving subscription contribution margins—supporting a trajectory of durable growth into FY2026 and beyond. The combination of data resilience and identity resilience positions Rubrik to capture a larger portion of the cyber resilience market, particularly as enterprises accelerate cloud transformations and GenAI initiatives. The forward-looking guidance implies continued top-line expansion with improving unit economics, albeit with seasonality in quarterly margins. Investors should monitor: (1) progress in identity resilience adoption and the Laminar DSPM integration; (2) ramp and monetization of Annapurna-genAI initiatives; (3) ARR retention and expansion dynamics as multi-product deals mature; (4) operating leverage and cash generation as the company scales. Given the current cash position and ARR growth momentum, Rubrik is well-positioned to fund continued R&D and GTM investments while pursuing a high-teens to low-20s multiple of ARR growth over the next 2–3 years, depending on execution and market adoption.
Key Investment Factors
Growth Potential
Rubrik's growth is anchored in a platform-based cyber resilience model spanning data and identity. ARR growth of 38% YoY to $1.18B and cloud ARR of $972M (+60% YoY) reflect strong cross-sell and expansion opportunities. Management highlighted identity resilience as a TAM-expanding initiative, with DSPM ARR up over 300% YoY. Annapurna represents a multi-year GenAI strategy that, if successful, could unlock sizable incremental demand across enterprise data, cloud, and SaaS workloads. The hybrid approach (on-prem, cloud, SaaS) supports broad addressable markets and a premium GTM motion (land-and-expand).
Profitability Risk
Key risks include the potential for slower-than-expected progress in identity resilience and GenAI-related offerings, execution risk in scaling Lateral Motion (DSPM and Identity Recovery), and macro-driven demand volatility. The NRR is historically >120%, but long-term moderation is anticipated due to larger multi-product deals and expansion mix. The company also relies on subscription ARR growth to drive profitability; any material underperformance in ARR could pressure margins. Competition from legacy vendors and other data-protection platforms remains a consideration as customers replatform and optimize security tooling.
Financial Position
Solid liquidity with $762M in cash and short-term investments and $323M in debt, yielding a net cash position per balance sheet data. The strong cash position underpins continued R&D investment and selective GTM expansion. Non-GAAP gross margin expanded to 80.5% in Q1 2026, with subscription ARR contribution margin improving to +8% (TTM), signaling operating leverage as scale increases.
SWOT Analysis
Strengths
Market-leading position in cyber resilience with a differentiated, native preemptive recovery engine
Platform approach across data and identity enabling cross-sell (land-and-expand) and high NRR
Strong ARR growth and improving unit economics (subscription ARR margin +8% YoY, non-GAAP gross margin 80.5%)
Significant cloud adoption and multi-hyperscaler coverage (AWS, Google Cloud, Azure, OCI)
Weaknesses
GAAP profitability remains negative; non-GAAP metrics rely on ARR timing and large customers
longer sales cycles for new identity resilience solutions and GenAI initiatives (Annapurna)
Opportunities
Identity resilience as a primary growth vector expanding TAM
Annapurna GenAI integration with cloud platforms (Google Agent Space) to accelerate GenAI deployment
Further cloud-native protections and DSPM expansion driving deeper penetration