Nutanix, Inc. Q4 FY2025 earnings call

• Fourth quarter 2025: Exceeded guided metrics, quarterly revenue $653M (+19% YOY), ARR $2.223B (+17% YOY), NRR 108%, non-GAAP gross margin 88.3%, non-GAAP operating margin 18%, free cash flow $208M. Full year 2025: Revenue $2.538B (+18% YOY), ARR $2.223B (+17% YOY), over 2,700 new customers, million-dollar-plus land and expand ACV transactions up over 60%, non-GAAP gross margin 88.1%, non-GAAP operating margin 21.1%, free cash flow $750M. • Product and partnership enhancements: Enhanced Gen AI capabilities with GPT in a Box 2.0 and Nutanix Enterprise AI, extended hybrid multi-cloud with Google Cloud public preview, Nutanix Store platform supports HCI and external storage, new partnership with Pure Storage in early access. • Wins: Finance Informatic migration, full-stack expansion with global financial services provider, first wins for cloud platform supporting Dell PowerFlex with two North American global 2,000 companies.

No specific breakdown of product segments with absolute terms and revenue contribution % provided in the transcript.

• Q1 2026 guidance: Revenue $676 - $680M, non-GAAP operating margin 19.5 - 20.5%. • Fiscal year 2026 initial guidance: Revenue $2.9 - $2.94B (+15% YOY midpoint), non-GAAP operating margin 21 - 22%, free cash flow $790M - $830M. Factors affecting guidance: Expected new logo growth rate, renewal ACV cohort growth slower than 2025, slight year-over-year decline in average contract duration, impact of license provisioning timing, contribution from Dell PowerFlex solution, delayed hiring and nonrecurring partner payments in fiscal year 2026.

• Uncertainty in the overall macro environment, including US federal government spending. • Currency fluctuations. • Longer deal cycles and increased variability in the US federal government business due to personnel changes and additional reviews. • Uncertainty around the timing and impact of large transactions with deferred license provisioning.

Q: Talk about the FI win and size of the deal, and other opportunities.

A: FI was a significant win, large multiyear deal, 15 new Global 2,000 customers added last year, larger deals are unpredictable but have interest across spectrum.

Q: Explanation for NRR down sequentially.

A: Impacted by net effect of ARR contributions from prior quarters, ARR booked in current quarter deferred, average deal size of new logos increasing, law of large numbers effect on ARR growth.

Q: Sense of Dell PowerFlex customers vs traditional, and Pure Storage early access.

A: Dell PowerFlex customers are top of pyramid, large global 2,000, Pure Storage in early access, on track for GA release end of calendar year.

Q: Commentary on US federal government.

A: Personnel changes and reviews causing longer deal cycles, still optimistic on modernization opportunity, Fed <10% of annual revenue.

Q: GPT in a Box maturity and revenue timing dynamics.

A: Early innings of AI inferencing adoption in enterprise, more to come, revenue timing affected by customers wanting licenses over time, visibility into 2026 transactions.

Q: Renewals cohort, ARR, and large transactions.

A: Renewals cohort growing but slower, ARR not quantified, large deals in pipeline with deferrals.

Q: Demand trends and VMware replacement opportunity.

A: Macro uncertainty factored into guidance, VMware replacement opportunity still multiyear journey, in second inning, lot of customers still to migrate.

Q: PowerFlex wins and contract duration impact.

A: Quick wins with Dell, collaborative with Dell, contract duration impacts revenue, average duration may decline with mix of business.

Q: Google Cloud engagement, Pure Storage GA, cash flow.

A: Google Cloud in public preview, Pure Storage on track for GA, cash flow impacted by contract duration.

Q: Margins and ARR factors.

A: Margin factors include delayed hiring, nonrecurring partner payments, run rate of hired employees; ARR components are land, expand, pricing, with confidence in land but uncertainty in expansion and pricing.

Q: Nutanix elements with Pure, pricing, NRR.

A: Nutanix cloud platform with Pure includes hypervisor, networking, etc., pricing varies by customer, NRR affected by multiple dynamics.

Q: OpEx and margins.

A: OpEx factors include run rate of hired employees, raises, incremental investments in R&D and sales, delayed hiring from 2025.