Rubrik Inc at Barclays Global Technology Conference Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Saket Kalia - Barclays Capital Inc - Analyst : So maybe for the folks in the room who haven't had the pleasure, Bipul, can you just maybe give us a brief synopsis of Rubrik's business and the market you compete in? And Kiran, maybe you can offer some -- just some financial highlights from the quarter you just reported last week. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 12, 2024 / 12:15AM, RBRK.N - Rubrik Inc at Barclays Global Technology Conference

Question: Saket Kalia - Barclays Capital Inc - Analyst : Absolutely. Good starting point. Kiran, maybe...

Question: Saket Kalia - Barclays Capital Inc - Analyst : Very helpful, that's very helpful overview. Bipul, maybe we can talk a little bit about the perception of the "backup" industry. A lot of people think about backup, and they think of data replication, right? Having a spare copy of your data in case of an outage or someone mistakenly delete something, right, that type of use case. The backup is becoming a little bit more of a security or CISO level security priority as you've seen. What are some key drivers of that shift?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Absolutely. Definitely came through when we spoke to customers, a lot of CISOs involved in the purchase decision. So it makes a ton of sense. Kiran, maybe for you. Can you just help contextualize where Rubrik kind of fits into the industry compared to other players out there? Maybe the question is -- maybe the way to delineate that is, how much of your business comes from larger enterprise customers like Fortune 500, Global 2000? And also how long is sort of a typical sales cycle for those types of customers?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Got it. Got it. Very helpful. Bipul, maybe just on that topic of the industry at large. I mean this has been a market -- and you referred to it earlier, this has been a market that's long been dominated by the likes of Dell EMC, Veritas, IBM. And those vendors are now considered legacy in this part of the -- in the data protection market. When you talk to customers -- and I know you spend a lot of time with customers. When you talk to customers that want to switch off of legacy technology, which vendors are you typically displacing the most? And how much more share is there to go, right, in terms of this disruption?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Yes. If we look back at last quarter's -- last week's earnings call, one of the most interesting things I thought was the customer examples that you were giving, almost all of them were talking about how you were backing up Azure or Salesforce or some sort of cloud product. And I know that those -- a lot of the public cloud companies, right, like the AWS or the Azure of the world, have native backup tools or capabilities that they've built in the platform. And a lot of -- I think a lot of investors have rightfully questioned like, hey, do you really need back up when the cloud is so pervasive and it's just such an incredible fallback? I mean, I guess maybe the question is, how do you think about sort of the value proposition of using Rubrik to back up cloud data, right, instead of their native cloud provider, if that makes sense?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Single pane of glass, basically?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Got it. Kiran, maybe for you. I'd love to talk about just -- I mean, the growth that you have existing customers, can you just give us a little bit of insight, first of all, remind us what the net revenue retention here is, right? Because I think that was a standout number last quarter. Could you just give us some insight into how much of that growth kind of comes from existing customers, maybe adding more applications and data, right, to Bipul's point around sort of the breadth of coverage versus cross-selling your customers, something that I want to talk about a little bit more, right, which is security, I mean again, I think it was a very healthy NRR number. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. DECEMBER 12, 2024 / 12:15AM, RBRK.N - Rubrik Inc at Barclays Global Technology Conference Talk to us a little bit about some of the drivers behind this.

Question: Saket Kalia - Barclays Capital Inc - Analyst : Got it. Got it. I think that's an interesting segue just into the -- there are two aspects of security here, Bipul, if you think about it. There's cyber recovery, right, backing up in a ransomware situation, for example. But then there's using the data that you look at and layering on more security on top of that, the data security. Talk to us about the adoption that you see from customers, the willingness of customers to think about you as a vendor, not as a backup vendor, but also a data security vendor?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Absolutely. I want to come back to the AI part of the story here in a second. But Kiran, maybe for you. I mean, I think we shifted to selling Rubrik Security Cloud around two years ago, if I remember correctly. And to Bipul's point, you sell different tiers based on whether a customer just wants straightforward sort of cyber resilience if they want to layer on more security on top of that. Can you just talk to us about the different pricing tiers? And what trends you're seeing in terms of customers adopting one versus the other?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Right. Right. Bipul, I will come back to the AI part of the story here. I mean, I think you touched on it a little bit, but maybe I'll ask the question a little more directly. How does AI become a revenue opportunity for Rubrik going forward?

Question: Saket Kalia - Barclays Capital Inc - Analyst : So interesting. Kiran, maybe we can just shift over to some financial questions. I would love to talk a little bit about the subscription transition story here, which I know is a fun discussion. Can you just remind us what stage we're in for this transition? And what are some of the milestones in the transition that we should look forward to?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Yeah. Absolutely. I'd love to -- the other part, I think, of the story we were talking about before, really what's been -- I think the most surprising thing to me has been the margin story here as well, right? And we have a metric, subscription ARR contribution margin, which kind of strips out some of the noise from that transition. Can you just maybe help us understand what's driving that big improvement in contribution margin that you're seeing and really from a business perspective, financial perspective, and what it's going to take to get to breakeven next year?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Absolutely, absolutely. It's been great to see. Bipul, I want to ask you a competitive question. So you've got a competitor out there, right, Cohesity that just closed the acquisition of the data protection business of Veritas, which has been a share donor in the past and arguably continues to be so. The question is, how do you think this deal will impact the market as a whole? And how could it maybe impact the new business that Rubrik might otherwise be getting from these legacy customers looking to make a switch?

Question: Saket Kalia - Barclays Capital Inc - Analyst : Absolutely. And this is a big market as well, right? And there's plenty of share gains to be had from others as well. Bipul, maybe the question I'd like to ask you and one of the ones that we're trying to ask in a lot of our sessions is, I know you spend a lot of time with customers. How do you sort of feel about the health of spending in this data protection area in calendar '25? Just sort of feeling on the ground, if you will.

Question: Saket Kalia - Barclays Capital Inc - Analyst : I couldn't think of a better way to end that session on that. So with that, let me thank Bipul and Kiran, thanks so much for being with us here today.