Rubrik, Inc. (RBRK) | The Buildout — AI Infrastructure
The Verdict
Rubrik provides a cloud-native platform that makes enterprise data and AI agents resilient to cyberattacks. Its Rubrik Security Cloud delivers immutable backups, anomaly detection, and orchestrated recovery for critical data and applications. A newer Rubrik Agent Cloud layer monitors, governs, and can rewind autonomous AI agents, addressing a gap in AI infrastructure governance. The platform is software-only, running on public cloud and on-premises appliances, and sells through channel partners to CIOs and CISOs worldwide.
| Market Cap | — |
| Revenue (TTM) | $1.4B |
| Revenue Growth | +45.7% |
| EBITDA Margin (TTM) | -18.5% |
| Net Cash | $603M |
| Earnings Beats | 7 of 7 |
| P/E (TTM) | — |
| EV/EBITDA (TTM) | — |
What We Like
- Subscription ARR of $1.57 billion growing 32% year-over-year, with cloud ARR up 43% and now 89% of total.
- Identity Resilience product reached $50 million+ ARR in roughly five quarters, growing 38% sequentially quarter-over-quarter, opening CISO budget access.
- Free cash flow inflected to $74 million in Q1, with full-year guidance of $293-303 million, showing the model is scaling profitably.
- $2.44 billion total remaining performance obligations, with 53% expected to be recognized as revenue in the next 12 months, providing high visibility.
- Rubrik Agent Cloud has early production deals and a six-global-system-integrator partner ecosystem (Project Hourglass) backing it.
What We’re Watching
- Two channel partners comprised 56% of Q1 revenue (10-Q); any disruption to those relationships could be material.
- RAC revenue remains undisclosed and likely immaterial; the AI governance market is nascent and faces competition from ServiceNow and Microsoft.
- Material-rights revenue headwind ($17 million FY2027) masks underlying growth; reported revenue will lag ARR growth until the headwind is exhausted.
- Sole-source appliance hardware from Supermicro, though management says no material impact; if sovereign demand revives on-premises, supply constraints could pinch.
The core thesis — that Rubrik is becoming an essential cyber-resilience platform for the AI era — is strengthening, supported by record net-new ARR, a raised outlook, and rapidly scaling new products. The open question is whether the Rubrik Agent Cloud can become a material revenue contributor before competitive platforms or partner concentration risk shift the trajectory.
Earnings Beat
Rubrik reported Q1 FY2027 total revenue of $387.1 million, up 39% year-over-year, with GAAP gross margin of 80.5%. Subscription ARR reached $1.57 billion, up 32%, and net-new ARR hit a Q1 record of $103 million. The net loss narrowed to $41.9 million from $102.1 million a year earlier, and free cash flow was $73.6 million.
| Metric | Q1 FY2027 | Q4 FY2026 | Q1 FY2026 | YoY |
|---|---|---|---|---|
| Revenue | $387M | $378M | $278M | +39.0% |
| Gross margin | 80.5% | 80.9% | 78.3% | +220bps |
| EBITDA | −$41M | −$72M | −$85M | −52.2% |
| EPS | $-0.21 | $-0.44 | $-0.53 | −61.4% |
| Net New Subscription ARR | $103M | n/a | n/a | — |
If you look at our magnitude of net new ARR of $103 million at our scale, we are unmatched by any company that you see in the cybersecurity industry.— Bipul Sinha, CEO, June 4, 2026 Q1 FY2027 earnings call
Management tone: Management's tone was markedly more confident compared to prior commentary, anchored to specific external catalysts like the Mythos threat model and record internal metrics. They used words like 'raised,' 'record,' and 'unmatched' frequently, and the CFO transparently detailed the material-rights headwind.
Management Guidance
Management raised its full-year FY2027 outlook: subscription ARR to $1.854-1.862 billion (~27% growth), total revenue to $1.638-1.648 billion, free cash flow to $293-303 million, and subscription ARR contribution margin to ~14%. The CFO noted that revenue growth normalized for material rights ($17 million full-year headwind) should outpace subscription ARR growth, implying underlying momentum is stronger than reported figures show.
Trajectory
Rubrik's revenue has increased for seven consecutive quarters as the subscription shift accelerates, with Q1 FY2027 revenue of $387 million marking 39% year-over-year growth. GAAP gross margin expanded to 80.5% from 73.1% in Q2 FY2025, reflecting scale and cloud efficiencies. EBITDA losses have narrowed sharply, from over $160 million quarterly to $40.6 million, as the company's contribution margin improves. The cloud transition is largely complete, with cloud ARR now 89% of subscription ARR, and the remaining material-rights revenue will fade through FY2027, unmasking the underlying growth rate.
The Model
The model projects FY+1 revenue of $1,660 million and EBITDA of -$118 million (-7.1% margin), anchored by the large remaining performance obligations and guided ARR growth. By FY+2, revenue is projected at $2,100 million with EBITDA flipping positive to $61 million (2.9% margin), driven by the fading material-rights headwind, continued scale in cloud subscriptions, and improving contribution margins.
| Metric | FY2026 | Next FY (E) | Following FY (E) |
|---|---|---|---|
| Revenue | $1.3B | $1.7B | $2.1B |
| YoY Growth | — | +26.1% | +26.5% |
| EBITDA | −$308M | −$118M | $61M |
| EBITDA Margin | -23.4% | -7.1% | 2.9% |
Projections are the median of 5 independent model runs. The model’s revenue sits 5.1% above analyst consensus.
Management raised its full-year FY2027 outlook: subscription ARR to $1.854-1.862 billion (~27% growth), total revenue to $1.638-1.648 billion, free cash flow to $293-303 million, and subscription ARR contribution margin to ~14%. The CFO noted that revenue growth normalized for material rights ($17 million full-year headwind) should outpace subscription ARR growth, implying underlying momentum is stronger than reported figures show.
What Could Go Right — and Wrong
- RAC becomes a material contributor, reaching $50-100 million ARR within a year, turning the AI governance option into a real growth pillar.
- Identity Resilience sustains 30-40% QoQ growth, crossing $100 million ARR and capturing CISO budgets.
- Mythos-like AI attacks intensify, making Rubrik's Preemptive Recovery Engine a must-have and driving ARR growth above 30%.
- Partner concentration diversifies as new channel relationships and direct sales reduce the 56% exposure.
- The contribution margin expands beyond 14%, accelerating GAAP profitability and free cash flow generation.
- One or both of the two large channel partners scale back or defect, cutting revenue sharply given the 56% combined share.
- RAC fails to gain traction; ARR remains immaterial after several quarters, and the AI governance narrative fades.
- Identity Resilience growth stalls after the initial land-grab among existing Rubrik customers, reverting to low-double-digit growth.
- Sovereign or federal demand revives on-premises appliance sales, exposing the sole-source Supermicro supply chain to constraints and margin pressure.
- The material-rights revenue fade masks a more rapid deceleration in new subscription bookings as the core backup market matures.
Looking Ahead
Over the next 12 months, Rubrik will work to execute against its raised FY2027 guidance while proving that Rubrik Agent Cloud can scale from early production deals to measurable ARR. The partnership ecosystem, including the six Global System Integrators committed to Project Hourglass, will be critical in driving enterprise adoption of the new AI operations platform. Meanwhile, the fading material-rights headwind should clarify the underlying growth rate and the trajectory toward GAAP profitability.
- Q2 FY2027 (mid-2026)Q2 earnings report — Tests net-new ARR sustainability and RAC production deal count.
- H2 2026RAC for Claude Code & Bedrock AgentCore scaling — Measurable pipeline from Project Hourglass GSIs; first RAC-specific disclosure.
- FY2027 end (Jan 2027)Full-year guidance achievement — Whether ARR, revenue, FCF, and contribution margin targets are met.
- Ongoing through FY2027Material rights fade progression — Revenue growth normalizes; $17M headwind disappears, revealing underlying pace.
- TBDPotential M&A or strategic hires — CEO flagged organic/inorganic opportunities; any acquisition to expand platform.
Financials
Annual Summary
| Metric | FY2026 | TTM |
|---|---|---|
| Revenue | $1.3B | $1.4B |
| Gross Margin | 80.0% | 80.6% |
| EBITDA | −$308M | −$736M |
| EBITDA Margin | -23.4% | -18.5% |
| Net Income | −$349M | −$289M |
| Free Cash Flow | $270M | $405M |
| Net Cash | — | — |
Key Ratios (Trailing)
- P/E TTM—
- EV/EBITDA TTM—
- EV/Revenue TTM—
- Price/FCF TTM—
- Gross Margin (TTM)80.6%
- EBITDA Margin (TTM)-18.5%
- Net Margin (TTM)-20.3%
- SBC / Revenue5.2%
The Company
Rubrik's platform, delivered through Rubrik Security Cloud, provides immutable backups, data security posture management, anomaly detection, and orchestrated recovery. Its newer identity resilience and AI governance products extend the platform to protect Active Directory, Okta, and autonomous AI agents. The company's software-only architecture and cloud-native delivery make it a consolidator in a market where point solutions are being rationalized.
Rubrik is software-first, running on AWS, Azure, and GCP, with no owned data centers. It sells primarily through channel partners, with two partners accounting for 56% of revenue. Its appliances, a shrinking part of the business, are built solely by Supermicro. The company has 2,946 customers with over $100K ARR, and its sales motion targets CIOs and CISOs through a partner-heavy model that is now adding large system integrators.
Business Segments
Competitive Landscape
Rubrik faces traditional data protection competitors like Commvault, Dell EMC, and Veeam, but the company argues its platform approach and net-new ARR pace set it apart. In the emerging AI governance space, ServiceNow views agentic control as a CMDB problem, while Datadog offers observability; Rubrik contends that only a full monitor-govern-rewind platform can secure autonomous agents. Adjacent security vendors such as Palo Alto Networks are often partners rather than direct competitors.
- CommvaultTraditional data protection competitor; Rubrik claims to be taking share with its cloud-native platform.
- Dell EMCLegacy data protection vendor; Rubrik's appliance-free cloud approach is winning displacement deals.
- VeeamFellow next-gen backup provider; Rubrik claims broader cyber-resilience and AI governance capabilities.
- CohesityDirect competitor in data protection; Rubrik positions its platform as more comprehensive.
- ServiceNowCompetes in AI agent governance; Rubrik argues observability alone is insufficient versus its comprehensive platform.
Supply Chain
Rubrik is a software-first company that runs its platform on AWS, Azure, and GCP, with a minimal physical footprint. Its only hardware dependency is the production of appliances by sole-source supplier Supermicro, which management says is immaterial to current results. The company primarily sells through channel partners, with two unnamed partners accounting for 56% of Q1 revenue.