Nutanix, Inc. SEC 10-K Report
Nutanix, Inc., a leader in enterprise cloud computing, has released its annual Form 10-K report, showcasing significant financial growth, strategic initiatives, and addressing key challenges. The report highlights the company's robust performance in the fiscal year, driven by software renewals, customer expansion, and strategic investments in technology and market positioning.
Financial Highlights
Total Revenue: $2,537.9 million, reflecting an 18% year-over-year increase driven by growth in software renewals and customer expansion.
Gross Profit: $2,203.1 million, with a gross margin of 86.8%, up from 84.9% in the previous year, indicating improved cost efficiency.
Operating Income: $172.5 million, a significant improvement from $7.6 million in the prior year, highlighting effective cost management and increased sales.
Net Income: $188.4 million, compared to a net loss of $124.8 million in the previous year, demonstrating a strong turnaround in profitability.
Net Income Per Share, Diluted: $0.65, reflecting the company's improved financial performance and profitability.
Business Highlights
Revenue Segments: The Nutanix Cloud Platform's revenue is primarily derived from subscription term-based licenses, which can be deployed on various qualified hardware platforms or via hosted services. The platform includes software entitlement subscriptions, support subscriptions, and cloud-based SaaS offerings.
Geographical Performance: The U.S. market saw a 19% increase in revenue, reaching $1,409.4 million. Europe, the Middle East, and Africa experienced a 22% growth, with revenue totaling $685.6 million. The Asia Pacific region grew by 13%, achieving $392.7 million in revenue, while the Other Americas saw a 6% increase, reaching $50.2 million.
Sales Units: The company reported a broad and diverse base of over 29,000 end customers as of July 31, 2025, reflecting a 10% growth in the customer base during the fiscal year.
New Product Launches: Nutanix has expanded its platform to support external storage and strengthened its Kubernetes capabilities, which are expected to address a broader range of customer infrastructure needs and deployment preferences.
Future Outlook: Nutanix plans to continue investing in sales and marketing to grow its customer footprint and expand sales to existing customers. The company also aims to deepen engagement with channel, OEM, cloud, and ecosystem partners to drive adoption and sales of its solutions.
Operational Strategy: Nutanix is focused on sustaining profitable growth by balancing investments in long-term growth initiatives with operational efficiencies. This includes improving go-to-market productivity and leveraging its partner ecosystem.
Customer Retention and Expansion: The company emphasizes a land-and-expand strategy, with 77% of end customers making repeat purchases. Nutanix's net dollar-based retention rate was 108% as of July 31, 2025, indicating strong customer retention and expansion.
Product Development: Nutanix continues to invest in research and development to enhance its existing technologies, develop new technologies, and support existing customer deployments. This includes a focus on generative AI and modern applications across hybrid and multicloud environments.
Strategic Initiatives
Strategic Initiatives: Nutanix, Inc. is focused on sustaining profitable growth by investing in sales and marketing to capitalize on market opportunities, particularly in major accounts and large deals. The company is also investing in research and development to enhance its solutions and expand its technology offerings, including developments in generative AI and modern applications across hybrid and multicloud environments.
Capital Management: Nutanix has engaged in several capital management activities, including the issuance of convertible senior notes with a 0.50% interest rate for an aggregate principal amount of $862.5 million due 2029. The company also repurchased $307.9 million of its Class A common stock and increased its share repurchase authorization by $350 million. Additionally, Nutanix entered into a revolving credit agreement providing a $500 million senior secured revolving credit facility. The company maintains a total leverage ratio of less than or equal to 3.75:1.00.
Future Outlook: Nutanix plans to continue investing in initiatives that support long-term growth while improving operating cash flow through operational efficiencies. The company aims to maintain a balance between growth investments and cash flow improvements, with a focus on leveraging channel and OEM partners to drive adoption and sales. Nutanix also intends to reduce overall sales and marketing spend as a percentage of revenue over time, while continuing to explore opportunities for capital investment in sustainable growth initiatives.
Challenges and Risks
Market Risks: The company operates in a highly competitive and rapidly evolving market, with intense competition from established companies and new entrants. The acquisition of VMware by Broadcom presents both opportunities and challenges, as changes in VMware's product portfolio and business model could impact the company's market share.
Operational Risks: The company has a history of losses and may struggle to maintain profitability. Its focus on growth could negatively impact near-term profitability, and macroeconomic or geopolitical conditions could adversely affect business operations. The company also faces challenges related to supply chain disruptions, reliance on key manufacturers, and the need to manage long sales cycles and complex transactions.
Regulatory Risks: The company is subject to complex and evolving regulations, including those related to privacy, data protection, and artificial intelligence. Compliance with these regulations could increase operational costs and impact business practices.
Cybersecurity Risks: The company is vulnerable to cyber attacks and other security incidents, which could lead to unauthorized access to sensitive information, reputational damage, and significant liabilities.
Intellectual Property Risks: The company faces potential claims of intellectual property infringement, which could result in costly litigation and impact its ability to sell products.
Financial Risks: The company's financial performance may be affected by fluctuations in revenue recognition due to its subscription-based business model. Changes in gross and operating margins, as well as exposure to foreign currency exchange rate fluctuations, could also impact financial results.
Management Strategies: Management has identified several strategies to address these challenges and risks, including balancing growth with operating expenses, expanding product offerings, targeting VMware's customer base, improving operational efficiency, and complying with evolving regulations.
Market Risks: The company is exposed to market risks, including foreign currency risk and interest rate risk, which could impact financial results and borrowing costs.
SEC Filing: Nutanix, Inc. [ NTNX ] - 10-K - Sep. 23, 2025