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CommVault sees Simpana upgrade, cloud as tonic for sales slump

CommVault missed its revenue expectations last quarter, a notion CEO Bob Hammer found especially frustrating because he sees great opportunity for the backup vendor to flourish. He also sees silver linings in CommVault’s impending Simpana product upgrade and the cloud.

CommVault’s revenue of $157 million last quarter increased 13 percent over last year but fell about $3 million short of Wall Street’s forecast. Hammer blamed the shortfall on failure to close big deals, particularly in North America. And he blamed that partly the vendor moving sales resources to the cloud and other parts of the world, and the distraction from winding down its Dell partnership.

CommVault executives say their issues are short-term, and maintain the company is on track to become a billion-dollar revenue player (its revenue for the just-completed fiscal year was $586 million). They said enterprise deals ($100,000 and up) did not fall through because customers went to competitors, and some have closed this quarter.

Hammer said he sees great potential for CommVault. The data protection space is wide open with the cloud changing market dynamics, Symantec plodding along without a CEO or clear direction and smaller vendors such as Actifio gaining momentum.

“Despite the weak quarter in the Americas, my confidence on the business in general is the highest it’s ever been,” Hammer said Friday on CommVault’s earnings call. “So I’m really confident that there is extremely high probability that if we get the execution pieces in place, we’re going to hit numbers.”

Later on the call, he added of the poor quarter, “You can tell from my voice, obviously, that it’s an execution issue and fundamentally pisses me off. So instead of fooling around with it, we said we’re going to hit this with a damn sledgehammer. So we put the engine in place to solve that problem. That’s pure execution.”

Hammer pointed to a massive shift to the cloud as part of his reason for optimism. He said approximately 200 service providers use Simpana for data protection, and CommVault will continue to invest heavily in cloud technologies.

Another reason for optimism is Simpana 10 R2, a major upgrade to CommVault’s backup and data management application due in July. “This release will include enhancements to core data management protection, particularly in the areas of virtualization, archiving and snapshot and replication management,” Hammer said.

He added the upgrade will include “new technology to securely and automatically move data to the cloud, in the cloud, and cloud-to-cloud, a standalone mobile solution with added capabilities for document sharing and data loss prevention … new solutions for operations management and intelligence and operations analytics … the ability to economically recover, use, replace and browse data in live native format and virtualized environments providing the capability to immediately restore, copy, back data into a usable state.”

Hammer revealed CommVault is preparing integrated appliances for archiving and cloud gateways that will involve partners. He said these appliances will be “engineered by CommVault and built on commercially available servers and storage.”

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