Commvault Systems (CVLT) FY2026 10-K Risk Factors: 14 New, 13 Dropped

What the changes say

$900 million of 0% convertible notes create new cash repayment, liquidity, dilution, and refinancing risks through 2030.
Fiscal 2026 restructuring may bring unexpected costs, cultural disruption, or failure to achieve operating and growth targets.
India now accounts for approximately 40% of employees, increasing exposure to wage inflation, talent shortages, and regional disruptions.
Subscription pricing, renewals, SaaS infrastructure commitments, indirect channels, and solution vulnerabilities receive greater emphasis.

What changed since the prior 10-K

New

NewRisks Related to Our Business and Industry
We rely on indirect sales channels, including resellers, systems integrators, distributors, OEMs, and marketplaces, and the failure of these channels to effectively sell our solutions could adversely affect our business
Resellers and other indirect partners may prioritize competing data protection products, reduce promotion, or terminate agreements, weakening sales.
NewRisks Related to Our Business and Industry
If we are unable to price our solutions competitively, manage costs associated with delivering our offerings, or maintain the scope and duration of customer subscriptions and support agreements, our business, results of operations, and financial condition could be adversely affected
Customers may demand lower prices, shorter renewals, fewer workloads or users, cheaper configurations, or concessions as they move to cloud and SaaS.
NewRisks Related to Our Business and Industry
Our reliance on interoperability with third‑party platforms, operating systems, cloud environments, and hardware products, as well as ongoing supply chain constraints, could adversely affect our product development, customer satisfaction, and results of operations
Changes to third-party operating systems, cloud platforms, applications, or hardware may require costly compatibility work that is delayed or unsuccessful.
NewRisks Related to Our Business and Industry
more difficult for customers, partners, and us to plan and forecast business activity. Increased volatility in foreign currency markets may also adversely affect our results of operations
Economic or geopolitical deterioration may delay orders, increase cancellations and payment defaults, worsen bad debt, and reduce operating cash flow.
NewRisks Related to Our Business and Industry
Our complex solutions may contain undetected errors, defects, or vulnerabilities, and incorrect or improper implementation or use of our solutions could result in customer dissatisfaction, increased data security risk, and harm to our business, financial condition, and reputation
Undetected defects or vulnerabilities, especially in unusual customer environments, could disrupt deployments, enable exploitation, and increase remediation costs.
NewRisks Related to Our Business and Industry
We implemented new restructuring plans in fiscal 2026, which we cannot guarantee will achieve their intended results
Fiscal 2026 restructuring may generate unexpected costs, damage culture, or fail to improve agility, resource alignment, operating performance, or growth.
NewRisks Related to Our Business and Industry
Our existing and future indebtedness, including our senior convertible notes and revolving credit facility, could adversely affect our business, results of operations, and financial condition
The $900 million of 0% convertible notes and future debt could divert cash from operations, investment, acquisitions, or repurchases.
NewRisks Related to our International Operations
Our significant operations in India expose us to operational, economic, and labor‑related risks that could adversely affect our business
Having approximately 40% of employees in India concentrates product development and growth activities in one location exposed to labor and operating risks.
NewRisks Related to our International Operations
we may be unable to cost‑effectively retain existing employees or attract and hire qualified new talent, which could increase operating costs, disrupt execution, or reduce margins
Rising Indian wages, intense technical hiring competition, inflation, unrest, conflict, infrastructure limits, and changing investment incentives could raise costs or disrupt execution.
NewRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
Changes in tax laws, regulations, or interpretations, and the inherent difficulty in projecting our effective tax rate, could materially adversely affect our business, results of operations, financial condition, and cash flows
Changing tax legislation, including the One Big Beautiful Bill Act and Section 162(m) limits after 2027, could increase tax expense and volatility.
NewRisks Related to Our Convertible Senior Notes
We may lack the cash or financing capacity to satisfy required cash payments under the Notes, including upon conversion, following a fundamental change, or at maturity
The company may lack cash or financing to repurchase, convert, or repay the Notes after a fundamental change, conversion, or at 2030 maturity.
NewRisks Related to Our Convertible Senior Notes
Conversion of the Notes may adversely affect our liquidity, dilute existing stockholders, and depress the price of our common stock, and the Capped Calls provide only partial offset
Note conversions could consume cash, create current liabilities, dilute shareholders, depress the stock price, and exceed the Capped Calls’ approximately $357.56 cap.
NewRisks Related to Our Convertible Senior Notes
The Notes and related Capped Call transactions may affect the trading price of our common stock and introduce volatility in our reported financial results
NewGeneral Risks
Our business could be materially and adversely affected by natural disasters, geopolitical instability, climate change, or other catastrophic events

Dropped

DroppedRisks Related to Our Business and Industry
In periods of volatile economic conditions, our exposure to credit risk and payment delinquencies on our accounts receivable significantly increases
DroppedRisks Related to Our Business and Industry
potential customers about the uses and benefits of our solutions; and the timing of the expiration of our customers’ current agreements for similar solutions
DroppedRisks Related to Our Business and Industry
We sell a backup appliance which integrates our solution with hardware. If we fail to accurately predict manufacturing requirements and manage our supply chain, we could incur additional costs or experience manufacturing delays that could harm our business
Separate risk that volatile economic conditions would increase accounts-receivable credit risk and payment delinquencies.
DroppedRisks Related to Our Business and Industry
Our complex solutions may contain undetected errors, which could adversely affect not only their performance but also our reputation and the acceptance of our solutions in the market
DroppedRisks Related to Our Business and Industry
Incorrect or improper implementation or use of our cyber resilience solutions could result in customer dissatisfaction and harm our business, financial condition, and results of operations
Unexpectedly long sales cycles could delay revenue, increase selling costs, and reduce margins.
DroppedRisks Related to Our Business and Industry
We completed a restructuring plan in fiscal 2025, which we cannot guarantee will achieve its intended results
DroppedRisks Related to Our Business and Industry
We are preparing to migrate a significant amount of customers from Red Hat environments, and any disruption, delay, or failure in executing this transition effectively could have a material adverse impact on our business operations and customer relationships
DroppedRisks Related to Our Business and Industry
Borrowing against our revolving credit facility could adversely affect our operations and financial results
Backup-appliance forecasting and supply-chain mistakes could cause excess-inventory charges, manufacturing delays, or lower margins.
DroppedRisks Related to our International Operations
If we are unable to effectively manage certain risks and challenges related to our India operations, our business could be harmed
Undetected errors or failures could impair solution performance, reputation, market acceptance, and revenue.
DroppedRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
Changes in tax laws or tax rulings could materially affect our financial position, results of operations, and cash flows
Improper implementation, training, or support could prevent customers from realizing value from cyber resilience solutions.
DroppedRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
Our effective tax rate is difficult to project, and changes in such tax rate or adverse results of tax examinations could adversely affect our operating results
DroppedRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
Impairment charges of long-lived assets, including assets held for sale, could adversely affect our financial condition and results of operations
DroppedGeneral Risks
Our business could be materially and adversely affected as a result of natural disasters, terrorism or other catastrophic events
Fiscal 2025 completion of the prior restructuring plan might not produce its intended benefits.

Reworded

100% rewrittenRisks Related to Our Business and Industry
We can experience long and unpredictable sales and implementation cycles, particularly with large enterprise and government customers, which could adversely affect the size, timing and predictability of our revenues
The wording now emphasizes lengthy, complex enterprise and public-sector approvals, formal procurement, contract expirations, and resource investment before uncertain sales.
Was: We encounter long sales and implementation cycles, particularly for our larger customers, which could have an adverse effect on the size, timing and predictability of our revenues
100% rewrittenRisks Related to Our Business and Industry
Our SaaS offerings require substantial and ongoing infrastructure investments, and if these investments do not yield the expected return, our business, results of operations, and financial condition could be adversely affected
The risk now adds ongoing infrastructure, hosting, security, availability, operations, and long-term cloud-provider commitments, alongside demand sensitivities.
Was: Our SaaS offerings require costly and continual infrastructure investments and if these investments do not yield the expected return, our business and financial performance might be adversely impacted
100% rewrittenRisks Related to Our Business and Industry
Volatility in the global economy, including changes in trade policy or tariffs, could adversely affect our continued growth, results of operations, financial condition, and our ability to forecast future performance
The update more specifically names tariffs and trade restrictions, supply-chain disruption, inflation, foreign exchange, reduced spending, and tighter credit.
Was: Volatility in the global economy could adversely impact our continued growth, results of operations and our ability to forecast future business
97% rewrittenRisks Related to Our Business and Industry
A portion of our revenue is generated by sales to government entities, which are subject to unique risks that could adversely affect our business
The update adds funding authorization, certification and authorization requirements, and FedRAMP to government-sales risks.
Was: A portion of our revenue is generated by sales to government entities, which are subject to a number of challenges and risks
97% rewrittenRisks Related to Our Business and Industry
Our industry is intensely competitive, and many of our competitors have greater resources and larger, established customer bases, which could enable them to compete more effectively than we do
The update names Rubrik, Cohesity, and Veeam and highlights competitors’ greater resources, installed bases, and brand recognition.
Was: Our industry is intensely competitive, and many of our competitors have greater financial, technical and sales and marketing resources and larger installed customer bases, which could enable them to compete more effectively than we do
96% rewrittenRisks Related to our International Operations
We may experience fluctuations in foreign currency exchange rates that could adversely affect our results of operations and financial condition
The update changes the focus from primarily translated revenue to both translation and transaction exposure across revenues, expenses, assets, liabilities, and intercompany transactions.
Was: We may experience fluctuations in foreign currency exchange rates that could adversely impact our results of operations
91% rewrittenRisks Related to Our Business and Industry
We have engaged, and may continue to engage, in strategic acquisitions, equity investments, and other transactions, which could have a material adverse effect on our business, results of operations, financial condition and cash flows
The update adds complex accounting, valuation judgments, impairments, write-downs, and losses for equity and strategic investments.
Was: We have engaged, and may continue to engage, in strategic acquisitions or transactions, which could have a material adverse effect on our business, results of operations, financial condition and cash flows
91% rewrittenRisks Related to Our Business and Industry
Our ability to sell our solutions and retain customers is dependent on the quality of our customer support and professional services, and any failure to provide high quality support or services could adversely affect our business, results of operations, and financial condition
The update shifts from storage-management installation to data-protection deployment and explicitly adds reduced renewals and expansion opportunities.
Was: Our ability to sell our solutions is highly dependent on the quality of our customer support and professional services, and failure to offer high quality customer support and professional services would have a material adverse effect on our sales and results of operations
91% rewrittenRisks Related to Our Business and Industry
Our investments in research and development may not result in significant revenues, and we may not realize a return on these investments for several years, if at all
Was: We may not receive significant revenues from our current research and development efforts for several years, if at all
80% rewrittenRisks Related to our International Operations
Our international sales and operations are subject to factors that could have an adverse effect on our results of operations
75% rewrittenRisks Related to Our Business and Industry
Changes in senior management or key personnel could cause disruption in the Company adversely affect our business, results of operations, and financial condition
Was: Changes in senior management or key personnel could cause disruption in the Company and have a material effect on our business
74% rewrittenRisks Related to Our Business and Industry
We depend on growth in the data protection and cyber resiliency market, and a slowdown or contraction in this market could have a material adverse effect on our business, results of operations, and financial condition
Was: We depend on growth in the data protection and cyber resiliency market, and lack of growth or contraction in this market could have a material adverse effect on our sales and financial condition
65% rewrittenRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
We are subject to numerous and evolving privacy and data protection laws and regulations, and our actual or perceived failure to comply with such laws and regulations could adversely affect our business
Was: We are subject to several local, state, federal and foreign laws and regulations regarding privacy and data protection, and any actual or perceived failure by us to comply with such laws and regulations could adversely affect our business
55% rewrittenRisks Related to Technology and Security
Any of these factors could adversely affect our business, results of operations, financial condition, and reputation, or subject us to legal liability
Was: Any of these factors could adversely affect our business, reputation, or financial results or subject us to legal liability
52% rewrittenRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
Goodwill represents a portion of our assets and any impairment of these assets could negatively impact our results of operations
46% rewrittenRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
The market price of our common stock may be volatile and could decline regardless of our operating performance
Was: The price of our common stock may be highly volatile and may decline regardless of our operating performance
40% rewrittenRisks Related to Technology and Security
We may be subject to IT system failures, network disruptions, cybersecurity incidents and breaches in data security, which could adversely affect our business, results of operations, and financial condition
Was: We may be subject to IT system failures, network disruptions, cybersecurity incidents and breaches in data security
39% rewrittenRisks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters
We may experience a decline in revenues or volatility in our quarterly operating results, which may adversely affect the market price of our common stock
37% rewrittenRisks Related to Technology and Security
If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, or to changing customer needs, requirements, or preferences, our products may become less competitive
29% rewrittenRisks Related to Technology and Security
We may not be successful in our initiatives that utilize AI, which could adversely affect our business, results of operations, financial condition, and reputation
Was: We may not be successful in our initiatives that utilize AI, which could adversely affect our business, reputation, or financial results

All 37 risk factors

Headings as the filing states them, in filing order.

Risks Related to Our Business and Industry

01Our industry is intensely competitive, and many of our competitors have greater resources and larger, established customer bases, which could enable them to compete more effectively than we do97% rewritten
02We rely on indirect sales channels, including resellers, systems integrators, distributors, OEMs, and marketplaces, and the failure of these channels to effectively sell our solutions could adversely affect our businessNew
03If we are unable to price our solutions competitively, manage costs associated with delivering our offerings, or maintain the scope and duration of customer subscriptions and support agreements, our business, results of operations, and financial condition could be adversely affectedNew
04Our reliance on interoperability with third‑party platforms, operating systems, cloud environments, and hardware products, as well as ongoing supply chain constraints, could adversely affect our product development, customer satisfaction, and results of operationsNew
05Volatility in the global economy, including changes in trade policy or tariffs, could adversely affect our continued growth, results of operations, financial condition, and our ability to forecast future performance100% rewritten
06more difficult for customers, partners, and us to plan and forecast business activity. Increased volatility in foreign currency markets may also adversely affect our results of operationsNew
07We can experience long and unpredictable sales and implementation cycles, particularly with large enterprise and government customers, which could adversely affect the size, timing and predictability of our revenues100% rewritten
08We depend on growth in the data protection and cyber resiliency market, and a slowdown or contraction in this market could have a material adverse effect on our business, results of operations, and financial condition74% rewritten
09Our SaaS offerings require substantial and ongoing infrastructure investments, and if these investments do not yield the expected return, our business, results of operations, and financial condition could be adversely affected100% rewritten
10Our complex solutions may contain undetected errors, defects, or vulnerabilities, and incorrect or improper implementation or use of our solutions could result in customer dissatisfaction, increased data security risk, and harm to our business, financial condition, and reputationNew
11Our investments in research and development may not result in significant revenues, and we may not realize a return on these investments for several years, if at all91% rewritten
12Our ability to sell our solutions and retain customers is dependent on the quality of our customer support and professional services, and any failure to provide high quality support or services could adversely affect our business, results of operations, and financial condition91% rewritten
13We implemented new restructuring plans in fiscal 2026, which we cannot guarantee will achieve their intended resultsNew
14A portion of our revenue is generated by sales to government entities, which are subject to unique risks that could adversely affect our business97% rewritten
15We have engaged, and may continue to engage, in strategic acquisitions, equity investments, and other transactions, which could have a material adverse effect on our business, results of operations, financial condition and cash flows91% rewritten
16Changes in senior management or key personnel could cause disruption in the Company adversely affect our business, results of operations, and financial condition75% rewritten
17Our existing and future indebtedness, including our senior convertible notes and revolving credit facility, could adversely affect our business, results of operations, and financial conditionNew

Risks Related to our International Operations

18Our significant operations in India expose us to operational, economic, and labor‑related risks that could adversely affect our businessNew
19we may be unable to cost‑effectively retain existing employees or attract and hire qualified new talent, which could increase operating costs, disrupt execution, or reduce marginsNew
20We may experience fluctuations in foreign currency exchange rates that could adversely affect our results of operations and financial condition96% rewritten
21Our international sales and operations are subject to factors that could have an adverse effect on our results of operations80% rewritten

Risks Related to Technology and Security

22We may be subject to IT system failures, network disruptions, cybersecurity incidents and breaches in data security, which could adversely affect our business, results of operations, and financial condition40% rewritten
23We may not be successful in our initiatives that utilize AI, which could adversely affect our business, results of operations, financial condition, and reputation29% rewritten
24Any of these factors could adversely affect our business, results of operations, financial condition, and reputation, or subject us to legal liability55% rewritten
25If we fail to adapt and respond effectively to rapidly changing technology, evolving industry standards, changing regulations, or to changing customer needs, requirements, or preferences, our products may become less competitive37% rewritten

Risks Related to Financial, Accounting, Regulatory, Tax, and Other Legal Matters

26We have been, and may in the future become, involved in litigation that may have a material adverse effect on our business
27We are subject to numerous and evolving privacy and data protection laws and regulations, and our actual or perceived failure to comply with such laws and regulations could adversely affect our business65% rewritten
28Changes in tax laws, regulations, or interpretations, and the inherent difficulty in projecting our effective tax rate, could materially adversely affect our business, results of operations, financial condition, and cash flowsNew
29Our reported financial results may be adversely affected by changes in accounting principles generally accepted in the United States
30Goodwill represents a portion of our assets and any impairment of these assets could negatively impact our results of operations52% rewritten
31We may experience a decline in revenues or volatility in our quarterly operating results, which may adversely affect the market price of our common stock39% rewritten
32The market price of our common stock may be volatile and could decline regardless of our operating performance46% rewritten
33Certain provisions of our certificate of incorporation and our amended and restated bylaws or Delaware law could prevent or delay a potential acquisition of control of our Company, which could decrease the trading price of our common stock

Risks Related to Our Convertible Senior Notes

34We may lack the cash or financing capacity to satisfy required cash payments under the Notes, including upon conversion, following a fundamental change, or at maturityNew
35Conversion of the Notes may adversely affect our liquidity, dilute existing stockholders, and depress the price of our common stock, and the Capped Calls provide only partial offsetNew
36The Notes and related Capped Call transactions may affect the trading price of our common stock and introduce volatility in our reported financial resultsNew

General Risks

37Our business could be materially and adversely affected by natural disasters, geopolitical instability, climate change, or other catastrophic eventsNew

Other Commvault Systems 10-Ks

FY2025 10-K risk factors
36 risks
Commvault's risk profile is dominated by intense cyber resiliency competition and macroeconomic volatility. Operational exposures center on SaaS investments, hardware supply chains, and a major customer migration from Red Hat.
Filed May 05, 2025

About this page

The headings are the filing's own. The one-line readings and the overview are automated and can be wrong: read Item 1A of the 10-K for the exact wording.